SEC Meets with Jito to Consider Staking for Crypto ETFs

The SEC Crypto Task Force has discussed the possibility of incorporating staking into an ETF, including the use of liquid staking tokens, with Jito Labs and Multicoin Capital.

According to a memorandum posted by the SEC, on February 5, 2025, the SEC Crypto Task Force met with representatives from Jito Labs and Multicoin Capital to discuss the possibility of incorporating staking into an ETP - a financial product traded on a stock exchange, allowing investors to buy and sell assets such as stocks, commodities or cryptocurrencies without direct ownership.

The meeting focused on two main issues:

The possibility of integrating staking into an ETP.

Potential staking models that could be applied to a crypto ETP, including liquid staking.

According to a memorandum posted by the SEC, on February 5, 2025, the SEC Crypto Task Force met with representatives from Jito Labs and Multicoin Capital to discuss the possibility of incorporating staking into an ETP, a financial product traded on a stock exchange, allowing investors to buy and sell assets such as stocks, commodities or cryptocurrencies without direct ownership.

The meeting focused on two main issues:

1. The possibility of integrating staking into an ETP.
2. Potential staking models that could be applied to a crypto ETP, including liquid staking.

Staking is a core mechanism in Proof-of-Stake (PoS) blockchains like Ethereum and Solana. Validators will have to “lock” assets to be able to validate transactions, maintain network security, and receive rewards in the form of transaction fees or new tokens.
Liquid Staking Token (LST) is a solution that helps investors stake assets and have liquidity. For example, in the Solana ecosystem, users stake SOL into the Jito stake pool and receive JitoSOL - a token representing staked assets and accumulated rewards. LST is not bound by the “unbonding” time like traditional staking, helping to ensure the ability to quickly withdraw funds when needed.

According to the memorandum, two staking models are being discussed for inclusion in ETPs:

1. Staking service model: ETPs stake a portion of assets through reputable validators like Jito Labs. Staked assets can be limited to a reasonable proportion (e.g. 40-60%) to ensure liquidity for withdrawals within T+1.
2. Liquid Staking Token (LST) model: ETPs hold LST instead of the native token. This helps maintain the flexibility of withdrawals while still taking advantage of the benefits of staking.

The SEC's crypto task force believes that including staking as a feature in certain ETP products will not only help investors benefit from yield staking but also increase the security of the blockchain ecosystem. The Crypto Task Force, Jito Labs, and Multicoin Capital are looking for solutions to make this happen and ensure compliance with SEC regulations.

According to many rumors from the community, the SEC's meeting with Jito Labs and Multicoin Capital is to prepare for the possibility of approving a series of Crypto ETFs in 2025 after the crypto task force is launched in the near future.
Immediately after the news, the JTO token representing the Jito protocol "built a column" to increase by more than 15%, currently trading around $3.43 with no signs of correction.