Ethereum News Today: New York's Staking Green Light Sparks Crypto Regulatory Shift

Coinbase Global has launched crypto staking services for New York residents on October 8, 2025, marking a significant regulatory breakthrough for the exchange after years of restrictions in one of the United States' most stringent crypto markets [1]. The service now supports staking for Ethereum, Solana, Cosmos, Cardano, Avalanche, Polygon, and Polkadot, with Cosmos offering the highest annual percentage yield (APY) at over 16%, while Ethereum staking returns approximately 1.9% APY [1]. The expansion brings Coinbase's staking program to 46 states, leaving only California, New Jersey, Maryland, and Wisconsin without access to the service [1].

The approval follows the dismissal of the U.S. Securities and Exchange Commission's (SEC) lawsuit against Coinbase earlier this year, which had alleged that the exchange offered unregistered securities through its staking operations [1]. The case resolution paved the way for New York's Department of Financial Services (NYDFS) to approve Coinbase's re-entry into the state. New York Governor Kathy Hochul's administration was credited for fostering a regulatory environment that enabled the launch, according to Coinbase [1]. The exchange highlighted that residents in the four remaining holdout states have collectively missed over $130 million in staking rewards since 2023 [3].

Coinbase CEO Brian Armstrong celebrated the development on X, emphasizing that staking-as-a-service should not be classified as a security. He criticized other states for maintaining restrictive policies and urged them to "drop their lawsuits and catch up" [1]. The company's legal team reiterated its position that staking services are not securities, a stance supported by recent SEC staff guidance and dismissals of similar cases in Vermont, Illinois, Kentucky, and South Carolina [3]. Coinbase also noted that federal legislation to standardize crypto regulations remains a priority, as it seeks to address the fragmented state-by-state enforcement landscape [3].

The market responded positively to the news, with Coinbase's stock (NASDAQ: COIN) rising over 2% in morning trading [2]. Analysts highlighted the potential for increased demand in proof-of-stake cryptocurrencies like Ethereum and Solana, as New York's 20 million residents gain access to yield-generating opportunities. The move is seen as a validation of staking as a legitimate financial tool rather than a speculative product, with broader implications for regulatory normalization in the crypto sector [2]. Institutional players, including Grayscale, have also introduced staking features in their Ethereum and Solana exchange-traded products, signaling growing comfort with compliant staking models [1].

Coinbase's expansion comes amid a broader shift in U.S. crypto policy. In August 2025, the SEC issued guidance clarifying that liquid staking arrangements, such as stETH tokens, do not constitute securities transactions [3]. This development has been interpreted as a step toward legitimizing staking infrastructure and could encourage further institutional adoption. The NYDFS's decision is now viewed as a potential catalyst for other states to reassess their staking policies, with Coinbase estimating that regulatory alignment could unlock substantial economic opportunities for millions of users [2].

Despite the progress, challenges remain. Four states continue to enforce staking bans, and legal actions in New Jersey and Washington persist [3]. Coinbase has not disclosed specific terms negotiated with New York regulators but emphasized the importance of state-level cooperation in overcoming barriers to crypto innovation. The company's recent acquisition of derivatives platform Deribit for $2.9 billion underscores its strategy to diversify beyond trading fees and position itself as a comprehensive financial services provider [3].

The launch of staking in New York represents a pivotal moment for Coinbase and the crypto industry. It demonstrates the potential for regulatory clarity to drive mainstream adoption and highlights the growing acceptance of blockchain-based yield mechanisms. As other states monitor New York's experience, the coming months may determine whether a more unified approach to staking regulation emerges, potentially reshaping the U.S. crypto landscape for years to come [1].