BTCS clarifies staking operations in response to SEC complaint against Kraken

BTCS clarified in a press release how StakeSeeker, its non-custodial staking-as-a-service platform, differs from other industry staking programs after the Securities and Exchange Commission on February 9 charged Kraken with failing to register the offer and sale of their crypto asset staking-as-a-service program. BTCS‘s non-custodial staking-as-a-service platform, StakeSeeker, "differs from Kraken’s custodial model in several key material ways," the company stated. Charles Allen, BTCS’s CEO, said: "When you stake with us, you are not an investor in our platform. You are a delegator to our nodes. If we go bankrupt, you do not get in line because we don’t have your crypto assets, you unstake them and move on. As the oldest public company in the crypto and blockchain sector, we’ve learned many lessons over the years. For example, we once held crypto at Mt. Gox but luckily withdrew it prior to its implosion. We learned from that near miss in 2014 and keep minimal crypto at exchanges." The company added: "When you stake with us, you are participating in a blockchain’s consensus mechanism, and you do not transfer ownership of your crypto assets to us. In light of recent failures such as FTX, Blockfi, and Celsius we encourage investors and crypto enthusiasts alike to learn about the value proposition of our non-custodial staking model. Your keys, your crypto, stake (not steak) with us. Many investors ask why we don’t offer staking for Ethereum, and the reason is simple. It’s a proof-of-stake blockchain, not a delegated proof-of-stake blockchain, and in our opinion, there isn’t currently a clear path to offer Ethereum staking without inadvertently creating a security. While we believe our non-custodial staking does not create securities, we can provide no assurances that either the SEC or other regulatory authorities will agree."