SEC releases new FAQs clarifying that staking receipt tokens tied to digital commodities may not be classified as securities if the issuer lacks control and does not provide essential managerial efforts.
DeFi & Yields ·
The SEC's Division of Corporation Finance has released new guidance addressing long-standing questions around token classification, particularly examining staking receipt tokens and issuer conduct under securities law. The agency clarified that a staking receipt representing a deposited digital commodity may qualify as a digital tool or commodity itself if the issuer does not gain ownership or control of the underlying asset and refrains from lending, pledging, or repurposing those funds.
The guidance also specifies what issuer activity falls outside Howey test investment contract scrutiny. Activities such as securing, maintaining, or improving a functional blockchain network—including development funding and network promotion—do not constitute the essential managerial efforts that would trigger securities classification. Similarly, announcing token buybacks for functional networks or marketing existing network capabilities generally do not establish an investment contract, unless the issuer explicitly promises yield or returns to holders.
The distinctions turn on both network maturity and issuer messaging. A buyback announcement for a non-functional network marketed as a yield mechanism would cross the securities threshold, while the same action for an established system would not. The guidance stops short of addressing all edge cases, leaving open the question of how mixed issuer conduct or evolving network status might affect classification determinations in practice.