Proof of Stake Alliance updates recommendations for staking providers
The Proof of Stake Alliance (POSA), a non-profit organization that represents firms in the crypto staking industry, published an updated version of its “staking principles” on Nov. 9. The new principles are supported by Ava Labs, Alluvial, Coinbase, Lido Protocol, Paradigm, and ten other staking industry firms.
POSA represents 15 different firms in the staking industry, including Alluvial, Ava Labs, Blockdaemon, Coinbase, Credibly Neutral, Figment, Infstones, Kiln, Lido Protocol, Luganodes, Methodic, Obol, Polychain, Paradigm, and Staking Rewards.
The staking principles were first published in 2020. According to the blog post that announced them, the POSA staking principles are meant to be “a set of industry-driven solutions” that providers can implement to address the concerns of regulators and to encourage responsible practices in the industry.
The old version of the staking principles says staking providers should not give investment advice, guarantee the amount of staking rewards that can be obtained, or imply that they have control over a protocol in their marketing materials. Instead, they should advertise that their products provide access to a protocol and allow users to enhance security. In addition, the principles state that staking providers should use non-financial terminology such as “staking reward” in their marketing materials instead of financial terms like “interest.”
The Nov. 9 announcement says three new principles will be added. First, staking providers will be encouraged to provide “Clear communication […] To ensure users have all the information necessary to make informed decisions.” Second, users should be able to decide how much of their assets they want to stake, as this will promote “user
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