# Title: US SEC Clarifies Protocol Staking on Proof of Stake Networks as Non-Securities
## Introduction
The U.S. Securities and Exchange Commission (SEC) recently made an announcement on May 29 regarding the classification of certain protocol staking activities on proof-of-stake (PoS) blockchain networks. This clarification sheds light on the treatment of staking in relation to federal securities laws.
## US SEC’s Division of Corporation Finance Statement
### Protocol Staking Activities Exemption
The Division of Corporation Finance emphasized that protocol staking activities on PoS networks, along with related services, are not deemed as securities offerings. This position is crucial as it exempts these activities from the registration or exemptions required under federal securities laws.
## Staking Activities Requiring No SEC Registration
### Self-Staking and Third-Party Custodial Staking
Participants engaging in specific protocol staking activities, such as self-staking by node operators and self-custodial staking with third parties, are not obligated to register their transactions with the SEC under the Securities Act. Additionally, custodial staking arrangements, where a custodian stakes on behalf of asset owners, fall under the same exemption.
## Staking Rewards Clarification
### Compensation for Node Operators
The Division clarified that staking rewards serve as compensation for the services rendered by node operators to the network. Unlike profits obtained through entrepreneurial or managerial activities, these payments are linked to the services provided, thus distinguishing staking from profit-oriented ventures.
## Conclusion
In conclusion, the recent statement from the US SEC’s Division of Corporation Finance provides clarity on the treatment of protocol staking activities on PoS networks, affirming their exemption from being classified as securities. This guidance offers reassurance to participants involved in staking by outlining the exemption criteria established by federal securities laws.
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