Today in crypto, the United States has cleared the path for crypto funds to participate in staking. The Bank of England has opened consultations on its proposed stablecoin framework, aiming to finalize the rules by 2026. Meanwhile, pressure on the crypto market could ease as the US Senate reached a deal to end the government shutdown.
US opens door for crypto ETFs, trusts to earn staking rewards
The US Internal Revenue Service (IRS), the country’s tax-collection bureau under the Department of the Treasury, has updated its guidance for cryptocurrency exchange-traded products (ETPs) to include a safe harbor for trusts to stake digital assets.
Treasury Secretary Scott Bessent wrote in a Monday X post that the agencies released guidance offering crypto ETPs “a clear path to stake digital assets and share staking rewards with their retail investors.”
According to the guidance available on the IRS website, government agencies would allow crypto trusts to participate in staking, provided they are traded on a national securities exchange, hold only cash and “units of a single type of digital asset,” held by a custodian, and mitigate specific risks to investors.
“The impact on staking adoption should be significant,” said Bill Hughes, senior counsel at Consensys, in a Monday X post.
“This safe harbor provides long-awaited regulatory and tax clarity for institutional vehicles such as crypto ETFs and trusts, enabling them to participate in staking while remaining compliant, Hughes wrote. “It effectively removes a major legal barrier that had discouraged fund sponsors, custodians, and asset managers from integrating staking yield into regulated investment products.”
The guidance followed the US Securities and Exchange Commission (SEC) in September approving generic listing standards, expecting to result in greenlighting crypto exchange-traded funds. The IRS and Treasury noted the SEC rule change as part of the updated guidance.
Bank of England launches stablecoin consultation, final rules to come in 2026
The United Kingdom’s central bank is moving toward stablecoin regulation by publishing a consultation paper proposing a regulatory framework for the asset class.
The Bank of England (BoE) on Monday released a proposed regulatory regime for sterling-denominated “systemic stablecoins,” or tokens it said are widely used in payments and therefore potentially pose risks to the UK financial stability.
Under the proposal, the central bank would require stablecoin issuers to back at least 40% of their liabilities with unremunerated deposits at the BoE, while allowing up to 60% in short-term UK government debt.
The consultation paper seeks feedback on the proposed regime until Feb. 10, 2026, with the BoE planning to finalize the regulations in the second half of the year.
As part of the proposal, the central bank suggested capping individual stablecoin holdings at 20,000 British pounds ($26,300) per token, while allowing exemptions from the proposed 10,000 pound ($13,200) for retail businesses.
“We propose that issuers implement per-coin holding limits of 20,000 GBP for individuals and 10 million pounds for businesses,” the BoE stated, adding that businesses could qualify for exemptions if higher balances are needed in the course of normal operations.
Regarding stablecoin backing, the BoE suggested that issuers that are considered systemically important could be allowed to hold up to 95% of their backing assets in UK government debt securities as they scale.
Crypto could get relief as Senate cuts deal to end shutdown
The crypto market could soon see some much-needed relief after the US Senate reached an agreement on Sunday on a three-part budget deal to end the government shutdown, Politico reported.
CNN reported that the Senate passed the bills in a 60-40 vote on Sunday night, just clipping the minimum 60 votes needed to pass them.
It was Republican Senate Majority Leader John Thune’s 15th attempt to win Democratic support for a House-approved bill, putting the record 40-day government shutdown within reach of being lifted this week.
Ongoing uncertainty over when the US government would reopen has been a key factor holding back Bitcoin (BTC) and the broader crypto market from mounting a rebound.
Bitcoin initially rallied to a new high of $126,080 six days into the government shutdown on Oct. 6, but has since fallen over 17% to $104,370, CoinGecko data shows.
Bitcoin’s fall over the past month saw it drop by double-digit percentage points on Oct. 10 after US President Donald Trump’s announcement of 100% tariffs on China sent shockwaves throughout the markets.
