Galaxy and Liquid Collective have formed a partnership to provide institutions with access to Ethereum liquid staking following SEC clarifications on the status of staking.
Galaxy and Liquid Collective Partnership
Galaxy and Liquid Collective announced their collaboration, with Galaxy facilitating over-the-counter (OTC) trading for LsETH, a token allowing institutional investors to earn rewards by staking ETH. Liquid staking enables investors to utilize their assets without locking them for a specific duration and receive a token for trading, lending, or other financial activities. Galaxy will also become a node operator in the Liquid Collective network, which could enhance network security and promote decentralization.
SEC Clarifies Crypto Staking
Recently, SEC staff clarified that certain common crypto staking activities do not violate existing securities laws. In a statement released on May 29, the SEC noted that 'Protocol Staking Activities', particularly staking on a proof-of-stake blockchain, do not require registration or fall under its exemptions. This clarification is significant as it places these activities outside traditional securities regulation.
Decentralization in Ethereum Staking
Vitalik Buterin, co-founder of Ethereum, has started exploring a system that promotes better decentralization of staking within the Ethereum community. Proposed solutions aim to penalize correlated failures among validators and suggest introducing incentives to discourage such behavior. This could lead to reduced centralization and foster greater decentralization within the Ethereum network.
The partnership between Galaxy and Liquid Collective marks an important step in the development of liquid staking in the crypto industry and underscores changing regulations around crypto staking, which may contribute to broader decentralization in the Ethereum ecosystem.
