SEC's guidance on liquid staking tokens a win for DeFi, institutions

Institutions may now have a clearer footing to build products around liquid staking tokens and unlock new market segments, according to industry executives.

The crypto industry is hailing the US Securities and Exchange Commission’s latest guidance on liquid staking as a rare regulatory win, with stakeholders calling it a major step forward for decentralized finance and institutional adoption of digital assets.

Released Tuesday, the SEC staff issued a guidance on liquid staking, writing that under certain conditions, liquid staking activities and the receipt tokens they generate do not constitute securities offerings.

“Institutions can now confidently integrate LSTs into their products which is sure to drive new revenue streams, expand customer bases, and enable the creation of secondary markets for staked assets,” Mara Schmiedt, CEO of blockchain developer company Alluvial told Cointelegraph.

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