Key Takeaways
SEC Commissioner Crenshaw criticized the new staff guidance on liquid staking for lacking clarity and failing to reflect industry realities.
The guidance makes broad assumptions and its legal conclusions may not apply to many real-world liquid staking operations.
SEC Commissioner Caroline Crenshaw slammed the staff’s liquid staking guidance on Tuesday, saying it offers little clarity and overlooks how staking works in the real world.
The Division of Corporation Finance, responsible for overseeing the disclosure practices of companies that publicly offer securities, declared earlier today that liquid staking activities are not considered securities transactions.
The clarification exempts participants from registering under securities regulations, aligning with the accommodating crypto approach established under the Trump administration’s Project Crypto.
Crenshaw called the staff’s liquid staking guidance legally narrow and built on shaky ground. She said it provides little clarity to crypto firms, doesn’t represent the Commission’s official stance, and carries no binding legal authority.
“The Liquid Staking Statement stacks factual assumption on top of factual assumption on top of factual assumption, resulting in a wobbly wall of facts without an anchor in industry reality,” Crenshaw said. She noted the guidance makes “definitive declarations about how liquid staking works” without supporting evidence.
Crenshaw stressed that the statement’s legal conclusions are limited by its numerous assumptions about liquid staking operations. When activities deviate from these assumptions, they fall outside the guidance’s scope.
The commissioner warned that the guidance “should provide little comfort to entities engaged in liquid staking,” noting it only represents staff views rather than those of the current or future Commission.
“For those entities whose liquid staking programs deviate in any respect from the soaring wall of factual assumptions erected in the Liquid Staking Statement, the message should be clear: Caveat liquid staker,” she added.