Liquid staking just got approved by the U.S. Securities and Exchange Commission. In a staff statement released Tuesday, the agency clarified that this type of staking does not require securities law disclosures, offering the industry a degree of legal clarity it has longsought.The statement, published by the SEC’s Division ofCorporation Finance, addresses how liquid staking works when users depositcrypto assets with a third-party provider in exchange for "receipttokens." These tokens can be used in decentralized finance (DeFi) whilethe original assets remain staked on proof-of-stake blockchains. No Entrepreneurial Effort Means No SecurityThis is not formal rulemaking or binding legalguidance. Instead, it reflects how the agency is currently viewing the issueand suggests that those who follow the described practices likely won’t faceenforcement.The SEC drew a line between what constitutes asecurities offering and what doesn't by focusing on the role of stakingproviders. According to the statement, these providers act merely as agentsexecuting staking on behalf of depositors. They don’t exercise managerialcontrol or make decisions about how the deposited assets are used.This framing echoes previous guidance on custodialstaking arrangements. In both cases, the lack of provider discretion over userassets appears to be a decisive factor in avoiding securitiesregulation.Market Reaction Muted but PositiveThe announcement caused a mild uptick in tokens tiedto popular liquid staking platforms such as Lido, Jito, and Rocket Pool.However, the gains were short-lived, and the tokens ended the day lower,according to data from CoinGecko.Despite the muted price response, the market appearsto welcome the legal breathing room. According to DeFi data aggregatorDefiLlama, liquid staking accounts for nearly $67 billion in total value lockedacross blockchains, with Lido alone responsible for $31.7 billion.More Clarity, Less Enforcement RiskTuesday’s statement adds to a growing patchwork of SECcommunications on staking. While earlier notes focused on protocol staking,this one zooms in on the mechanics of liquid staking—especially around rewarddistribution, token minting, and slashing.For now, crypto firms and users engaged in liquidstaking can breathe a little easier. But the lack of formal rulemaking meansthe relief could be temporary, depending on future enforcement actions orchanges in agency leadership.This article was written by Jared Kirui at www.financemagnates.com.