SEC clarifies that Ethereum liquid staking tokens are not securities

The U.S. Securities and Exchange Commission (SEC) has issued guidance clarifying that liquid staking tokens backed by Ethereum (ETH) are not considered securities, provided they function strictly as receipts. This determination, released by the SEC's Division of Corporate Finance, offers significant regulatory clarity for major service providers such as Lido and Rocket Pool.

Under this guidance, a staking receipt token is classified as a ‘digital tool’ when the underlying asset is a commodity. To maintain this status and avoid being classified as a security under the Howey Test, the token must not alter the rights associated with the locked ETH or offer additional rewards. Furthermore, providers are prohibited from lending, promising, or reusing the deposited coins. This distinction relies on the fact that Ethereum was previously identified as a digital commodity rather than a security.