Are you really surprised? The SEC’s new tricks on crypto ETFs are infuriating. By putting off determinations on in-kind redemptions and Ether ETF staking, they look less like cautious overseers and more like defenders against the nascent but accelerating altcoin revolution.

Is This Wall Street Protecting Itself?

Let’s be blunt. The SEC’s unwillingness to approve staking in spot Ether ETFs reeks of cronyism. For WisdomTree, VanEck, and Bitwise—they are holding up their decisions on in-kind redemptions. Grayscale are facing the same issue, too. Indeed, we’re witnessing the same rigmarole again and again all across the country.

Think about it: who really benefits from keeping innovative financial products like staked Ether ETFs off the market? No, it’s not the retail investor, desperate to find new investment opportunities and build their wealth in an increasingly decentralized world. No, it’s the entrenched Wall Street behemoths that benefit from the status quo. From bilingual to online, it feels like they are attempting to find a way to save the old system no matter what.

  • Staking empowers individuals. It allows them to earn passive income on their crypto holdings, directly participating in the network's security and governance.
  • ETFs democratize access. They provide a regulated and familiar investment vehicle for those hesitant to dive headfirst into the complexities of DeFi.

The SEC’s continued delay and denial of these innovations further entrenches the market share of existing, more traditional financial institutions. These institutions are terrified of the decentralized future that crypto represents. Instead, they are fighting to maintain the influence they currently have.

Remember the RadioShack bankruptcy? They relied on an outdated business model that they weren’t willing to change despite their inability to adjust to the new digital world. The SEC’s moves appear more like the last-minute, desperate attempts to save a long-moribund status quo on life support. In the meantime, the future continues to roll on without them.

Are We Treating Adults Like Children?

The SEC likes to use “investor protection” as a justification for its more extreme, protectionist regulations. How much protection is too much protection before we slip into paternalism. Are we seriously arguing that adults lack the judgment to spend their own dollars?

There are infinitely horrifying risks that come with crypto investments in general. Risk is inherent in all investing. The stock market is not risk-free. Real estate is not risk-free. Even if you keep your cash in a savings account, you still face the risk that inflation will eat away at its value.

The answer lies in transparency and education, not in bans and stalling tactics. Provide consumers—retail investors and broader public—transparent and consistent understanding of the risks and benefits of staking. After that, give them the space to choose their own path informed by the work.

Imagine if the government banned the sale of spicy food because some people found it too hot. Absurd, right? Yet, that's essentially what the SEC is doing with crypto staking – protecting people from a potential "burn" by denying them the chance to experience the flavor altogether.

Hong Kong, Canada, Europe Are Ahead!

Climate change is happening today and the rest of the world isn’t standing still. As noted above, stakeholders in Hong Kong, Canada, and Europe have already seen ACK approved staking for ETFs. Are they recklessly endangering their citizens? Or are they just acknowledging the opportunity of this new technology and establishing a regulatory framework that encourages innovation?

Bloomberg Intelligence ETF analyst James Seyffart notes the SEC isn't likely to rush its decisions based on approvals from other regulators. Okay, fine. But how much independent decision-making crosses into the realm of willful ignorance. The SEC is out of step and out of time.

Think about the early days of the internet. The US federal government loudly argued about the risks of this shiny new technology. In contrast, other countries jumped on it and established the infrastructure and policies that have created today’s digital economy. Are we about to make the same mistake all over again with crypto? Here’s hoping our country doesn’t cede our leadership in this technology revolution to other countries!

This isn't just about ETFs. It's about the future of finance. It's about whether we want a decentralized, permissionless system that empowers individuals or a centralized, controlled system that benefits the elite.

The hindsight – altcoin revolution will not be televised… or SEC approved. Let’s reclaim that vision and create the future we really want, one decentralized transaction at a time. Are you in?

Here’s what you can do:

  • Contact your elected officials. Tell them that you support responsible crypto regulation that fosters innovation, not stifles it.
  • Support crypto advocacy groups. Organizations like the Blockchain Association and Coin Center are fighting for sensible crypto policies in Washington.
  • Explore alternative decentralized platforms. Don't wait for the SEC to give you permission to participate in the altcoin revolution. There are already numerous decentralized platforms where you can stake your crypto and earn rewards.

The altcoin revolution is not going to be televised… or SEC-approved. It's up to us to build the future we want, one decentralized transaction at a time. Are you in?