Crypto Leaders Respond to SEC’s Staking Crackdown: Is Staking a Security?
The leaders of Kraken and Coinbase, CEO Jesse Powell and Chief Legal Officer Paul Grewal, have expressed their disappointment in the recent enforcement action taken by the U.S. Securities and Exchange Commission (SEC) against crypto staking.
SEC Chairman Gary Gensler claimed that Kraken had failed to properly inform the public of the risks associated with staking digital assets on its platform. However, Powell disputed this claim and indicated that it would have been a simple process to follow the necessary regulatory requirements.
Oh man, all I had to do was fill out a form on a website and tell people that staking rewards come from staking? Wish I'd seen this video before paying a $30m fine and agreeing to permanently shut down the service in the US. How dumb do I look. Gosh. ⛽️💡https://t.co/UPdQdnI6xN
— Jesse Powell (@jespow) February 10, 2023
Grewal weighed in on the matter, stating that staking is a legitimate form of investment for digital asset holders and that rules and regulations could address any concerns. He answered common questions about staking and explained that it is a way to earn rewards by helping secure a blockchain.
Charles Hoskinson, the creator of Cardano (ADA), commented on the unclear stance of the SEC regarding crypto staking.
READ MORE: Ethereum (ETH) Predicted to Make a Big Move
He noted that the SEC’s enforcement action against Kraken may have been based on the structure of its staking service, but not the underlying assets themselves.
Hoskinson emphasized that staking mechanics do not make the underlying asset a security and that it is possible to structure commodities, such as wheat or gold, as securities without affecting their underlying nature.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
