Recently, the U.S. Securities and Exchange Commission (“SEC”) reached a settlement with Kraken and its staking program. We wanted to highlight several features that differentiate Kraken’s staking program from proof-of-stake crypto staking provided by a non-custodial staking service like stakefish. We believe that stakefish, a protocol-level non-custodial proof-of-stake staking service, remains unaffected by the SEC’s settlement with Kraken.
According to the SEC complaint, Kraken’s staking program was a passive investment, which involved a pool of crypto assets, including both Kraken’s assets and their customers’ assets. Kraken determined whether to, when to, and how much to actually stake these assets, and the assets under the staking program were not necessarily staked. Additionally, Kraken’s staking program determined the reward rate, as opposed to the underlying protocol, and provided instant liquidity regardless of the unbonding periods. The participants were not subjected to transaction fees or minimum staking thresholds. The SEC argued that Kraken’s staking program should have registered with the SEC.
With stakefish staking, every time a user contributes 32 ETH, the tokens are deposited into the Beacon chain as soon as possible, and every 32 ETH a user contributes corresponds to an Ethereum validator running on the Ethereum Beacon chain. stakefish does not take custody of any stakers’ Ethereum, so stakers always have full control over their crypto. stakefish performs active work, such as block proposal and block validation on the stakers’ behalf to earn rewards. Staking reward rates are determined by the proof-of-stake networks, and stakers pay transaction fees to interact with the blockchain and smart contracts, and they are subject to protocol-level lockups of their funds (e.g. unbounding periods).
stakefish operates with a commitment to providing safe and secure staking services, and we have implemented several measures to ensure the security and protection of stakers. For instance, stakefish has secure and user-friendly staking smart contracts that are audited and maintained by a team of experienced developers, as well as 24/7 monitoring and maintenance to ensure that stakers’ tokens are secure.
In conclusion, while the SEC action against Kraken highlighted the importance of differentiating between intermediary staking services offered to stakers and the protocol-level proof-of-stake staking offered by stakefish, stakefish continues to offer a safe and secure staking solution. As a protocol-level non-custodial proof-of-stake staking service, stakefish does not pool tokens and operates in a manner that is distinct from Kraken’s staking program. By using stakefish, users have peace of mind knowing that their tokens are in self-custody, safe, and secure.
stakefish is the leading validator for Proof of Stake blockchains. With support for 20+ networks, our mission is to secure and contribute to this exciting new ecosystem while enabling our users to stake confidently.