The U.S. SEC recently held separate meetings with BlackRock and the Crypto Council for Innovation’s (CCI) Proof of Stake Alliance to discuss regulatory issues surrounding crypto ETPs.
These discussions, which took place on April 1, focused on addressing how crypto-based financial products could be structured and regulated.
During its meeting with the SEC’s Crypto Task Force, BlackRock addressed the mechanics of in-kind redemptions for crypto ETPs in the U.S. The asset management giant, represented by senior officials from its regulatory affairs, product engineering, ETF capital markets, and federal policy divisions, shared insights on the current cash-based workflows used in ETPs. They also proposed how similar structures might be adapted for in-kind models, potentially shaping future crypto-based funds.
Meanwhile, the SEC separately engaged with members of the Proof of Stake Alliance, a group under the Crypto Council for Innovation, which includes representatives from firms like a16z, Paradigm, Consensys, Alluvial, Lido Labs Foundation, and Marinade.
The conversation revolved around staking practices within crypto ETPs, exploring different staking models such as liquid, custodial, and delegated non-custodial staking. The group emphasized the need for regulatory clarity on staking-as-a-service principles, covering validator responsibilities, user participation, and how staking rewards might affect the risk profile of staking-enabled crypto ETPs.
The SEC’s discussions with BlackRock and the Proof of Stake Alliance reflect a continued effort to address the regulatory challenges posed by crypto ETPs. This follows a previous meeting in February when the SEC consulted with Jito Labs and Multicoin Capital to consider the potential inclusion of staking within crypto ETPs. Representatives from these firms argued that staking is integral to proof-of-stake blockchains like Ethereum and Solana and proposed models that would balance staking functionality with liquidity needs.
Though the SEC has not yet announced any concrete regulatory changes, the ongoing dialogues indicate a push towards better understanding the technical and legal aspects of crypto financial products. The agency’s engagement with key industry players shows a willingness to consider evolving financial innovations while addressing investor protection and market integrity.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
Source: https://coindoo.com/sec-explores-staking-rules-for-crypto-etps-with-blackrock-and-cci/