Regulation
SEC Targets Ethereum Liquid Staking
The lawsuit alleging that Lido and Rocket Pool violate securities laws comes less than two weeks after the SEC dropped its investigation into Ethereum.
The SEC filed a trial against blockchain software company Consensys, claiming that Lido and Rocket Pool’s liquid staking programs constitute unregistered securities.
The lawsuit targets Consensys, alleging that the company offers these securities in unregistered transactions through its “Metamask Staking” platform.
Pool and Rocket Pool are two of the largest liquid staking protocols on Ethereum and hold a combined $37.6 billion in staked TVL, according to DeFiLlama. The protocol’s native tokens quickly fell, with the LDO dropping 12% in 30 minutes.
This news comes just 10 days after the SEC informed Consensys that it was closing its ongoing investigation into Ethereum 2.0 and that the agency would not pursue enforcement action against Consensys.
Consensys’ public letter following the closure of the investigation suggested that its legal battle with the SEC was far from over.
The company declared“It is imperative that the SEC abandon its opaque and unprincipled rulemaking by leading an enforcement campaign for much-needed regulatory clarity for an industry that serves as the backbone of countless new technologies and innovations.”