The Securities and Exchange Commission (SEC) Crypto Task Force held separate meetings with representatives from the BlackRock and the Crypto Council for Innovation (CCI) Sport of Stake Alliance on April 1 to discuss regulatory issues related to crypto exchange sales products (ETPs).
According to a memo about the meeting, BlackRock discussed the physical redemption of crypto ETP traded in the US. At the same time, CCI included staking ETPs within topics discussed with regulators.
Cryptographic ETP changes
BlackRock participants included regulatory issues, product engineering, ETF capital markets and senior representatives of the federal government.
During a session with the Crypto Task Force, BlackRock presented a document detailing the role of market participants in supporting existing workflows and cash models used in ETPS. The company also addressed how these systems could be applied to potential physical models for future crypto-based funds.
Separately, the SEC met with members of the Cripto Council-based Stake Alliance Certification for Innovation.
The group consisted of representatives from companies such as A16Z, Paradigm, Consensy, Alibial, Lido Labs Foundation, and Marinade, discussing staking-related topics and their impact on Crypto ETP.
The agenda included reviews of various staking models, including liquids, management, and delegated non-lawful staking. Participants also presented the principles of the existing industry as a service, aimed at informing them of validation operations and regulatory treatment of user participation in empirical networks.
This discussion also touched on how reward, validator liability, and service provider relational factors can be factors in the risk profile and assessment of potential staking-enabled crypto ETPs.
Staking Crypto ETP Offer
The SEC’s involvement with BlackRock and proof of stake alliances have a continuous institutional interest in promoting clarity in the regulation of cryptocurrency products.
The discussion is as follows: Previous meeting It was held on February 5th, during which the SEC’s Cryptographic Task Force met with representatives from Jito Labs and Multicoin Capital to assess the potential inclusion of staking within Crypto ETPS.
Participants, including Jito Labs CEO Lucas Bruder and partner Kyle Samani at Multicoin Capital Managing, argued that staking is essential for Stormof-of-Stake (POS) blockchains such as Ethereum and Solana.
They pointed out that excluding staking from ETPS could reduce investors’ returns and undermine the functional utility of POS assets. Representatives from Jito Labs and Multicoin Capital proposed two models to address SEC concerns.
The “service model” allows partial staking through third-party valtters while maintaining liquidity for redemption, while the “liquid staking token model” allows ETP to retain liquid staking tokens.
Although no regulatory results have been disclosed, the meeting forms part of the SEC’s ongoing review process to assess the technical and legal framework for Crypto ETP.
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