With the recent statements issued by the SEC, updated criteria have been introduced that could profoundly impact the ways in which exchanges, investors, and DeFi operators handle liquid staking.
According to data collected by industry analysts in the first quarter of 2025, regulation has already influenced the strategy of over 40% of the main liquid staking platforms. This regulatory intervention is set to impart a new direction, bringing greater clarity but also a more rigorous focus on the risks and opportunities offered by liquidity in the crypto sector.
Liquid Staking: what it is and why it is changing DeFi
Liquid staking represents a significant evolution in cryptocurrency staking. It is based on sending digital assets to specific protocols that, in exchange for the “staking,” issue a receipt token. This token reflects in real-time both the ownership of the deposited cryptocurrencies and the rewards generated.
Unlike traditional staking, the main feature is that the liquidity is not locked. Users can use, trade, or employ these tokens in further financial operations, fully leveraging the flexibility of the DeFi ecosystem.
- Immediate liquidity available: the value of your assets is usable without lock-up periods.
- Automatic rewards: you participate in the network’s rewards even while the receipt tokens are employed elsewhere.
- Integration with various services: it is possible to use the receipt tokens as collateral in other DeFi protocols.
Risks of Liquid Staking: technology, rules, and security under scrutiny
Despite the advantages, liquid staking presents significant risks. Users must rely on the robustness of the smart contracts. An error or a cyber attack can put at risk the deposited funds and the associated receipt tokens.
In addition, the custody of the received tokens represents a new area of vulnerability: losing access to these tokens entails the risk of losing not only the rewards but also the initial capital.
A concrete case: In 2024 the liquid restaking platform Bedrock experienced an exploit that resulted in an estimated loss of about 2 million dollars, highlighting the importance of preferring projects with thorough and transparent audits. Analysts and the crypto community agree that similar events require a more robust regulatory framework and greater attention from operators to ensure security.
Important note: Risks related to regulations remain. A sudden change in directives — like the recent ones from the SEC — can affect the operation or valuation of tokens.
Liquid Staking and SEC: what really changes for tokens and regulation?
The most recent statements from the SEC mark a turning point: not all liquid staking activities are necessarily to be considered financial securities under the Securities Act of 1933 and 1934. The regulation indeed requires a thorough case-by-case evaluation, examining the protocol structure, the issuance method, and the function performed by the received token.
- A single universal criterion does not apply: a liquid staking token might be classified as a security only in specific situations.
- Analysis focused on functionality and design: the authorities verify if the token represents a promise of profit derived from the work of others.
- Continuous monitoring: the SEC aims to ensure transparency and to intervene to prevent abuses, without hindering innovation.
This approach has sparked a heated debate, especially among those who fear that overly strict rules could slow down the development of DeFi tools, as highlighted by multiple industry reports.
How does Liquid Staking work?
In practice, participating in liquid staking is a simple process: the user deposits cryptocurrencies into a smart contract and immediately receives a token. This token not only certifies the ownership of the assets, but can be used as collateral, sold, or integrated into other DeFi protocols.
In this way the user:
- Continue to obtain rewards automatically.
- You have the possibility to redeem the funds at any time, respecting the rules of the protocol.
- Enjoy the flexibility of operating in an increasingly interconnected ecosystem.
Recent example: Lido, a well-known liquid staking protocol, reached 38 billion dollars in locked assets in February 2025, controlling over 28% of the total ETH in staking on the Ethereum network. Market analysts highlight how Lido has set new standards of security and transparency for the sector, with over 94% of assets undergoing verification through public audits.
Cryptocurrencies and Staking: what changes for investors and platforms?
For industry operators, the new regulation on crypto staking represents a decisive test. It will be necessary to adopt more transparent and solid procedures, balancing regulatory compliance with the aspiration for innovation.
Paul S. Atkins, president of the SEC appointed in 2025, has expressed the intent to ensure transparent guidelines, ensuring that regulation does not hinder technological evolution. This scenario implies for investors a greater protection, but also the need to stay constantly updated on regulatory news.
Liquid Staking VS Traditional Staking: why the difference matters
It is essential to distinguish between liquid staking and traditional staking before making operational choices. In the classic model, assets remain locked for a certain period, preventing early liquidation. In liquid staking, however, the receipt token makes liquidity immediately available and can be used in other DeFi areas.
- Traditional staking: locked funds, limited flexibility.
- Liquid staking: fluid liquidity, versatile use of assets.
- Both models provide rewards, but with different distribution methods.
How to Obtain Rewards from Liquid Staking?
The procedure is straightforward: deposit cryptocurrencies, receive a receipt token, and take part in the reward distribution system provided by the protocol. The rewards are assigned periodically and can be redeemed, exchanged, or reinvested, according to the rules of each platform. This mechanism has already attracted millions of dollars equivalent in assets within a few months, pushing DeFi towards new horizons.
Liquid Staking and Regulations: are we truly entering a new era?
The most recent statements from the SEC have clarified that the classification of liquid staking within the framework of securities regulations is not guaranteed. Each protocol will be evaluated separately. This paves the way for a calibrated and specific regulation, moving away from a uniform and rigid approach. The authorities remain vigilant, but they seem intent on not blocking the progress of this sector.
SEC Rules and Liquid Staking: what future for DeFi?
The new SEC rules on liquid staking represent much more than a simple technical guideline: they are a message for the entire ecosystem, from developers to small investors. The regulatory framework is now more defined, but there remains a component of uncertainty. DeFi confirms itself as a dynamic field, where rules and technology continuously influence each other.
In the coming months, further clarifications and possibly new regulatory measures are expected, which could still alter the balances and scenarios of crypto innovation.
Conclusion: Liquid Staking, innovation between security and rules
Liquid staking is confirmed as one of the most significant innovations in the current DeFi landscape. Among the needs for yield, liquidity flexibility, and the new SEC directives, this sector requires an informed, prudent attitude attentive to new developments. The regulatory context is evolving rapidly: only those who stay updated will be able to fully seize the opportunities and, at the same time, avoid the pitfalls of a constantly changing world.