Blockchain validator Everstake has met with the United States Securities and Exchange Commission’s (SEC) Crypto Task Force in an effort to promote the recognition of non-custodial staking as a technical process rather than a securities transaction. The meeting comes after over $193 billion worth of assets have been staked on proof-of-stake (PoS) chains, yet U.S. regulation around staking remains unclear. Legal Uncertainty Clouds U.S. Staking Market The SEC, in its previous leadership, targeted the big players like Kraken, Coinbase, and Consensys for their staking products. However, with the current crypto-friendly administration, some of these actions have since been withdrawn. However, the agency has declined to make a definitive statement on non-custodial staking, keeping the industry in limbo. Everstake: Staking Is Not a Securities Transaction Everstake told regulators that its model allows users to maintain full ownership of their tokens, delegating validation rights but not ownership. “Staking is not a financial instrument or security transaction, but rather a technical process. similar to an oracle in a database,” said Everstake founder Sergii Vasylchuk. Letter to SEC Calls for Policy Clarity Everstake submitted a formal letter to the SEC on April 8, 2025, responding to Commissioner Hester Peirce’s call for stakeholder input. The company explained in its letter why non-custodial staking should not be subject to securities laws. Users: Retain ownership of assets Do not commingle funds Are not promised profits from a managing entity Receive rewards from algorithms at the network level Howey Test Argument Everstake argued that non-custodial staking satisfies all four prongs of the Howey test for securities status. The firm compared its model to proof-of-work mining, which has not been treated as a securities activity by the SEC. Chief Legal Officer Margaret Rosenfeld in a statement that applying securities law to staking would “undermine the decentralized model and risk chilling innovation.” Industry Pushes for Broader Regulatory Guidance In a second letter on April 30, nearly 30 crypto advocacy groups, led by the Crypto Council for Innovation, also urged the SEC to bring clarity to rules for crypto staking. While the SEC has made no assurances of comprehensive guidelines, it continues to engage with stakeholders from across the crypto ecosystem, including ETF and infrastructure providers. Everstake’s activities are symbolic of the growing demand for a definitive, functional regulatory environment for staking models that are consistent with the technical reality of decentralized networks.
