On Thursday, May 29, the SEC’s Division of Corporation Finance released long awaited guidance on protocol staking activities. This is the first definitive public statement from the Commission directly addressing whether common protocol staking practices constitute securities offerings under US federal securities laws.
The key takeaway: they do not.
This is a major milestone for the proof-of-stake ecosystem. The SEC affirmed that protocol staking, when performed by node operators, third party providers, or custodians, does not involve the offer or sale of securities. That clarity applies across solo staking (where the asset owner runs their own validator), self-custodial staking with a third party operator (such as Figment), and custodial staking (where a custodian facilitates staking on behalf of a customer).
The SEC’s memo also provided one of the clearest, most technically sound explanations of protocol staking to date, covering the mechanics of validator selection, the nature of staking rewards, and the role of staking in network security.
For Figment and our clients, this guidance reaffirms what we have long believed and built around:
Rewards earned through staking are programmatic outputs of the network’s software protocol, including transaction fees and new token issuance, not the result of managerial decision making by Figment or any other validator. The role of a validator is administrative or ministerial.
And thus, US customers who use Figment’s non-custodial staking services directly, or stake via a custodian who, in turn, delegates to Figment, are not engaging in a securities transaction.
The statement also addresses ancillary services, or operational conveniences, offered alongside staking by service providers. These include providing slashing insurance coverage, early unbonding options, custom rewards pay out schedules, and the aggregation of customer assets to meet network staking minimums. The SEC made clear that the staking provider is not acting in a way to invoke securities law should it offer these particular any of the above services as part of its staking offering.
For institutional investors, including ETFs and other institutional investors that have been evaluating staking, this is the clearest green light yet. The regulatory uncertainty that has long cast a shadow over protocol staking has been reduced to zero. For Figment, which has always led with compliance, technical excellence, and non-custodial independence, this validates the model we’ve been committed to from the start.
We will continue working closely with partners, clients, and regulators to ensure staking remains accessible, secure, and aligned with both legal and technical best practices. The fact that the SEC is now issuing this kind of thoughtful, detailed guidance reflects a meaningful shift in its understanding of the industry and it is exactly the type of engagement we had hoped to see from the current Commission.
