The SEC's July 2025 guidance clarifies that solo staking, delegated staking, and custodial staking relating to a network’s consensus process are not considered securities offerings. Rewards from these activities are viewed as compensation for services rather than profits from others’ efforts, thus exempting them from the Howey test. Protocol staking is recognized as essential for network function, encouraging wider participation. Activities like yield farming and guaranteed return schemes still fall under securities regulation. Stakeholders like validators and custodial service providers can operate with reduced legal uncertainty, allowing retail and institutional participants to engage more freely. The guidance permits solo staking, non-custodial delegated staking, custodial staking, and validator services. Ancillary services are allowed as long as they remain administrative. For compliant staking practices, it’s important to maintain asset control, avoid fixed returns, and ensure transparent arrangements. Overall, the SEC's framework is expected to foster growth in PoS ecosystems and promote participation without legal ambiguities.

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