Exclusive: will the SEC regulator approve staking within the framework of spot Ethereum-ETFs
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Johny Smith
2024/12/26
5 mins read
Representatives of Bernstein recently published an analytical report. In the study, experts concluded that the US Securities and Exchange Commission (SEC) may approve staking within spot funds on Ethereum. Experts told the editors how viable this scenario is.
Bitget Research lead analyst Ryan Lee emphasized that staking falls under the ban in the S1 filing for spot funds on Ethereum. However, there is no news that would clearly indicate that the situation may change. Document S1 states that fund issuers, custodians, or any entities associated with an ETH trust are not eligible to engage in Ethereum staking activities. The fact is that staking services will require the transfer of ETH to a smart contract. This means that the custodian will not have control over the assets. In the event of unexpected network or technical problems, users may lose their funds.
Minestream CEO Rafik Mamin noted that the approval of staking for spot Ethereum-ETFs seems to be a completely realistic scenario, but there are certain nuances. SEC staff have previously stated that features like stakingcan be considered separately, which means that the regulator is at least ready for dialogue. Positive rhetoric is also observed from the US Congress, which is actively working to create a regulatory framework aimed at the crypto segment. However, it cannot be ruled out that the SEC may block such an initiative. The agency treats the niche of cryptocurrency funds with great caution, especially regarding issues related to preventing potential market manipulation.
ICO Rocket PR CEO Oksana Belyanskaya agrees with the opinion that the SEC may approve Ethereum-ETF staking. The regulator is gradually getting used to the digital assets segment, showing readiness to evaluate more complex specialized instruments. But there are certainly risks of blocking this initiative. SEC representatives often talk about the protection of user rights and the problems of the cryptocurrency market associated with its opacity. The main claims against staking can be made regarding the provision of liquidity and proper protection of investor rights.
OXLY Development Director Danatar Atajanov agrees that Ethereum-ETF staking may be approved, but with certain reservations. Again, SEC staff have repeatedly expressed dissatisfaction with financial proposals that could lead to the illegal issuance of securities. Rhetoric regarding investor protection was also common. However, the niche of cryptocurrency ETFs is growing rapidly. There are also changes in the approach to regulating the digital assets segment. Now one of the key topics remains the transfer of powers to regulate the cryptocurrency niche from the SEC to the CFTC. If this happens, there could be a significant liberalization of oversight of this segment.
General Director of Integration LLC Anna Rozhkova noted that there is clear positivity in the cryptocurrency sector regarding the upcoming presidency of Donald Trump.
However, many people overlook the fact that he has already gotten everything he wanted from this niche. Moreover, digital assets will not help the Trump administration overcome the problems associated with the budget crisis, inflation and US foreign debt. Staking itself Ethereum can become a neutral topic. Against the backdrop of the upcoming congressional elections, the staking project compares favorably with other core initiatives. Therefore, staking within the Ethereum ETF has a high chance of approval.
Head of Marketing at Block-Chain-Expert Alexey Lebedev believes that the Ethereum network has established itself as the leading blockchain with staking support. Its appearance in the context of ETFs will allow users to receive additional rewards. This is fully consistent with the global trend of mass adoption of the segment decentralized finance. However, do not forget that the SEC is very wary of any instruments related to the digital asset niche. Still, risks for potential investors, lack of regulatory standardization and complexities of legal interpretation may become a stumbling block to the approval of staking in spot ETFs. But the SEC could take an interim solution by ratifying staking in a limited form. For example, insurance of funds or partial distribution of income will be required to minimize risks and increase transparency of the process.
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