BlackRock Meets SEC Crypto Task Force to Address Staking, Tokenization, and ETF Rules

• BlackRock met the SEC Crypto Task Force to discuss staking tokenization and crypto ETF approval standards.
• The SEC may allow traditional firms to tokenize services through a proposed exemption using blockchain systems.
• The meeting marked the 99th industry session held by the SEC since February under Acting Chairman Mark Uyeda.

BlackRock Inc. recently met with the U.S. Securities and Exchange Commission’s (SEC) Crypto Task Force. The discussion focused on staking, tokenization, and evolving crypto ETF standards. The investment firm requested the meeting to share updates and address key regulatory concerns.

Review of BlackRock’s Crypto Products

The session began with an overview of BlackRock’s digital asset offerings. These include the iShares Bitcoin Trust (IBIT), iShares Ethereum Trust (ETHA), and BUIDL, a tokenization product. These products represent BlackRock’s growing presence in digital finance. 

The SEC considered the structure and placement of every offering. Regulatory clarity for such products remains ambiguous especially in the light of the enforcement actions by the agency.

BlackRock used the meeting to describe, in detail, what its products do and how they are regulated in accordance with existing regulations. The discussion was meant to ensure that the product development aligns with the compliance expectations of the SEC.

Focus on Staking and ETF Rules

The two parties then turned to staking. BlackRock and other issuers have pushed for staking features to be included in crypto exchange-traded products (ETPs). However, the SEC has shown hesitation. 

Recently, it delayed Grayscale’s proposal to allow staking within its fund offerings. This signals the regulator’s cautious approach toward staking in investment vehicles.

The meeting also examined crypto ETF structures. Topics included exercise thresholds and asset holding limits. These technical areas remain under-defined in U.S. law. As a result, many firms face delays in launching complex crypto products. BlackRock aims to work with the SEC to better define these standards. The company wants more consistent rules that would allow innovation while protecting investors.

Tokenization and Possible Exemption Orders

The third area of discussion was tokenization. BlackRock emphasized its plans to expand tokenized investment products using blockchain technology. The SEC is exploring whether it should offer clear frameworks or exemptions. 

According to SEC Commissioner Hester Peirce, the agency is considering an exemption order. This would allow traditional financial providers to tokenize services using Distributed Ledger Technology (DLT).

This meeting marked the 99th commission between the SEC and crypto industry participants since February. Under Acting Chairman Mark Uyeda and current chair Atkins, the SEC has increased engagement with digital asset firms. 

The Crypto Task Force , a new SEC unit, now regularly hosts roundtable discussions. Another roundtable is planned later this month. It will focus on tokenization and the path toward clearer approval standards for crypto ETPs.