Digital assets exchange Bitstamp today said it is stopping its Ethereum staking service for American customers next month.
In a statement to Decrypt Wednesday, Bitstamp said it would stop offering U.S. customers staking rewards from September 25.
The reason, the Luxembourg-based exchange said, is down to regulation involving the service currently in the States.
“Considering current regulatory dynamics in the U.S., Bitstamp made the decision to discontinue staking for customers residing in the United States,” Bitstamp’s U.S. CEO and global chief commercial officer at Bitstamp Bobby Zagotta said.
Staking is the process of “locking-up” cryptocurrency to keep a blockchain’s network running. Proof-of-stake assets—such as Ethereum (ETH)—pledge it to the network by sending it to a specific blockchain address and can receive rewards for doing so.
It’s a controversial issue in the states and Wall Street’s biggest regulator, the U.S. Securities and Exchange Commission has gone after major crypto exchanges like Coinbase and Kraken with fines.
The SEC alleged in February that Kraken failed to register the offer and sale of its crypto asset staking-as-a-service program and hit it with a $30 million fine. In June, it sued Coinbase, alleging that the San Francisco-based company offered and sold unregistered securities via its staking service.
Bitstamp added that customers will continue earning staking rewards up until September 25 but after that, all staked assets will be unstaked. They’ll then be credited to users’ Bitstamp wallets, the company said.
Coinbase Updates Staking Service Following Regulatory Crackdown
Coinbase today told users that it is updating the terms and conditions of its staking service—one month after U.S. regulators cracked down on similar products. America’s biggest cryptocurrency exchange said in an email to customers on Friday that staking will continue and emphasized that clients will earn rewards through protocols and not Coinbase itself—which is a particular point of contention among U.S. regulators like the SEC. Staking is the process of “locking-up” cryptocurrency to keep a...
The exchange earlier this month announced that U.S. customers would no longer be able to trade Axie Infinity (AXS), Chiliz (CHZ), Decentraland (MANA), Polygon (MATIC), NEAR Protocol (NEAR), The Sandbox (SAND), and Solana (SOL) on its platform.
