The SEC has officially exempted major Ethereum and Solana staking protocols, including Lido and Jito, from securities laws, enabling their staking services and related tokens like stETH and mSOL to operate without regulations typically governing securities. This ruling follows earlier exemptions for self-custodial and custodial staking, suggesting a significant shift towards regulatory clarity in the crypto space. The decision is expected to pave the way for the approval of staking ETFs, as the SEC noted that these liquid staking tokens will facilitate liquidity management within spot ETH ETFs. This ruling is particularly impactful for Ethereum, where Lido controls over 30% of staked ETH, and for Solana, as Jito is integral to its staking infrastructure. With the SEC's ruling, broader decentralized protocols may also benefit, potentially accelerating institutional interest and setting precedents for liquid restaking and cross-chain staking. Despite this positive development, cryptocurrency prices saw a slight decline, reflecting market volatility amidst regulatory updates.

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