Main highlights
- On November 10th, the U.S. Treasury Department and Internal Revenue Service (IRS) shared updated guidelines that provide a clear path to crypto ETPs for staking digital assets.
- The new guidelines will allow ETP issuers to stake their underlying assets on blockchain networks and distribute staking rewards directly to retail investors.
- This newly updated guideline for crypto ETPs comes after the SEC clarified that certain liquidity staking activities do not constitute an offering of securities under federal law.
On November 10, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) issued new guidance providing a clear regulatory framework for virtual currency exchange traded products (ETPs).
today @USTreasury and @IRSnews has issued new guidance that provides a clear path for staking digital assets in crypto exchange traded products (ETPs) and sharing staking rewards with retail investors.
This move increases returns for investors, fosters innovation, and preserves America’s standing.
— Treasury Secretary Scott Bessent (@SecScottBessent) November 10, 2025
This will allow crypto ETFs such as Spot Bitcoin ETF and Ethereum ETF to participate in proof-of-stake (PoS) digital asset staking activities.
“This action will increase returns for investors, foster innovation, and ensure the United States remains a world leader in digital assets and blockchain technology,” Treasury Secretary Scott Bessent said in a post on X (formerly Twitter).
What are the new guidelines for crypto ETPs with staking?
This new regulatory framework will allow issuers of exchange-traded products to participate in “staking” of crypto assets held within funds.
Staking is the process of generating rewards that can be passed on to ordinary investors and involves supporting the operation of a blockchain network.
These payments are treated in the same way as dividends from traditional stocks and funds, providing a new potential source of income.
Previously, strict U.S. regulations limited these ETPs to a passive role, allowing them to only hold assets without the ability to generate such yields.
The policy was officially announced in a statement from Treasury Secretary Scott Bessent, who revealed that the main goal is to expand investor access to blockchain-based returns.
This guidance specifically authorizes virtual currency exchange traded products (ETPs) to directly engage with staking protocols. This means that funds can lock assets in proof-of-stake networks such as Ethereum or Solana to help validate transactions and earn rewards in return.
The new rules will allow these fees to be distributed to investors without creating immediate tax complications for the fund itself, as long as strict compliance measures are followed.
The main benefit for the average investor is the ability to earn a passive income stream. Through standard brokerage accounts, individuals can now earn staking yields without the technical knowledge required to manage a private wallet.
Some experts now expect increased demand from both institutional investors and retailers for proof-of-stake tokens, which will drive the expansion of the crypto ETP market.
However, ETP issuers must also maintain a high level of transparency regarding their staking operations. This includes clear disclosure of risks to investors, such as the possibility of a slash, where validators can be penalized and lose some of their staked assets due to network failures or malicious actions.
The guidance also makes clear that staking rewards are taxed as the investor’s ordinary income, based on their fair market value at the time the investor gains control of the rewards.
SEC clears up confusion over liquid staking tokens
statement from Treasury Secretary Scott Bessent took office after the U.S. Securities and Exchange Commission’s (SEC) Division of Corporation Finance issued a staff statement in August. The agency clarified in a statement that certain liquidity staking activities do not constitute an offering of securities under federal law. This statement opened the door for many ETFs with liquidity staking tokens, including Solana.
The official press release states, “Accordingly, it is the Department’s view that participants in protocol staking activities are not required to register transactions under the Securities Act with the Commission and do not fall within any of the registration exemptions under the Securities Act related to these protocol staking activities.”