Prominent web3 wallet MetaMask has extended its service scope by adding a staking feature in its Portfolio app. The new functionality lets users stake two cryptocurrencies, Ether (ETH) and Polygon’s MATIC token, to secure their networks and gain rewards.
This feature facilitates users to compare staking rates on the app itself, thus maximizing potential returns. Additionally, they can diversify their staked assets across multiple providers through a single dashboard. As of now, ETH staking is supported via Lido and Rocketpool, while MATIC staking is enabled through Lido and Stader Labs, but only for users outside the United States.
Staking Facilitated through Token Routing
The novel process by which MetaMask enables staking involves routing tokens to the user-selected provider. These tokens are then deposited, thereby activating the staking rewards. In a demonstration of flexibility, users have the option to withdraw their assets at any time they wish.
Increased Scrutiny from Regulatory Bodies
Even as staking services become increasingly accessible to cryptocurrency users, regulatory bodies and agencies have been amplifying their oversight of this ecosystem.
The US Internal Revenue Service (IRS) recently issued a ruling, on July 31, stipulating that the ‘fair market value’ of staking rewards must be declared as gross income in the year they are received. Moreover, the Securities and Exchange Commission (SEC) has been actively targeting several digital asset exchanges due to its interpretation that staking services are equivalent to securities offerings.
In a significant move, the SEC fined the Kraken exchange $30 million over its staking offerings and ultimately compelled it to withdraw from the US jurisdiction. Meanwhile, Coinbase is currently in the midst of a legal tussle with the same agency.