The SEC’s Division of Corporation Finance recently issued a statement on Certain Protocol Staking Activities, essentially articulating the Division’s view that “Protocol Staking Activities,” do not involve the offer and sale of securities within the meaning of the Securities Act of 1933 or the Securities Exchange Act of 1934.

As a result, no registration is required for persons involved in this activity, according to the statement. 

Commissioner Caroline Crenshaw described these activities, which are defined in the statement, as “locking up crypto tokens in a blockchain protocol to earn awards.”

This article is part of a Fenwick "Securities Law Update" authored by David A. Bell, Ran Ben-Tzur, Amanda Rose, and Wendy Grasso.