As reported by Kraken, two Kraken subsidiaries settled a deal with the US Securities and Exchange Commission (SEC). According to this deal, Kraken, one of the largest and oldest Bitcoin exchanges in the world, has agreed with the request from SEC (Securities and Exchange commission in the USA) to stop providing its on-chain staking services to US-based clients starting from February 9. For clients that used to stake non-ETH cryptos, these will be automatically unstaked and returned to the investor’s online wallet. The only exception is Ether (ETH). ETHs will only be unstaked after the Shanghai upgrade. Until then ETH investors will keep earning rewards. Staking for non-US clients will continue as usual.
Staking means locking up cryptocurrencies to receive rewards. Investors are doing it to get paid with more crypto assets.
The move is a part of the settlement with SEC. Earlier on the Securities and Exchange Commission said that most staking providers fail to provide their customers with proper disclosures on how they protect their users’ staked assets. These providers should register their staking services with the SEC, the Commission’s representative added. It is expected that staking may soon be banned in the USA.