U.S. Senator Cynthia Lummis, Chair of the Senate Banking Subcommittee on Digital Assets, along with Senators Kirsten Gillibrand, Steve Daines, Ron Wyden, Thom Tillis, Bill Hagerty, and Bernie Moreno, has reached out to the Securities and Exchange Commission (SEC) seeking clarification on its stance regarding protocol staking in digital asset exchange traded products (ETPs).
In a bipartisan letter to the SEC, the senators expressed concern over the impact of the current restrictions on protocol staking for ETP issuers in the United States. "The current lack of availability of protocol staking for these issuers significantly impacts the investment potential of digital asset ETPs in the U.S. and challenges the competitive positioning of U.S. asset managers in the global market," they wrote. They noted that ETPs in Canada and Europe do not face such prohibitions.
The letter outlines specific inquiries for the SEC, including details about their analysis used to restrict protocol staking from certain S-1 filings, identified opportunities and risks associated with protocol staking, and their rationale for prohibiting staking within securities instruments.
The senators have requested a response from the SEC by March 21, 2025. The full text of their letter is available online.
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