New Jersey Set to Lift Staking Restrictions on Coinbase Following Three-Year Limitation

Coinbase's Regulatory Update in New Jersey

In a recent quarterly report, Coinbase revealed that the New Jersey Bureau of Securities is considering lifting a three-year-old enforcement order that has limited residents from participating in new staking activities. The announcement came following a notification from the regulator, which indicated intentions to rescind the cease-and-desist order as of October 29, 2026. However, it is important to note that this announcement is not yet finalized, and no specific timeline for lifting the restrictions has been provided.

Current Staking Limitations

Despite the potential lifting of the order, customers in New Jersey currently remain unable to stake new principal. Those who already have existing staked assets can still earn rewards on them, but cannot reinvest or compound these rewards. The limitations established have allowed some residents to continue receiving these rewards, although they have been barred from adding to their staked assets during this period.

As of now, New Jersey is still counted among the states where Coinbase faces regulatory restrictions, alongside California, Maryland, and Wisconsin. Notably, Washington's residents can still stake without encountering similar limitations.

Background of the Enforcement Order

The enforcement order originally imposed on Coinbase by New Jersey’s securities agency dates back to June 6, 2023. The order claimed that the staking services offered by Coinbase were akin to securities and thus subject to state registration laws. Staking, as defined by the bureau, involves committing cryptocurrencies to uphold blockchain networks, where validators earn rewards for processing transactions on proof-of-stake platforms. Coinbase has steadfastly contested the assertion that its staking services fall under the category of securities.

Following feedback in July 2023 regarding regulations in California, New Jersey, South Carolina, and Wisconsin, Coinbase was required to halt the addition of new staking assets for retail customers while disputes were ongoing. Nevertheless, it stressed that previously staked assets remained unaffected.

Recent Developments and Advocacy

The potential rescission from New Jersey comes after states such as Alabama, Kentucky, Illinois, South Carolina, and Vermont previously lifted their respective actions against Coinbase between March and April 2025. At that time, Alabama had already withdrawn its enforcement measures, while South Carolina's case was resolved through an agreement that restored staking services on Coinbase’s platform.

Coinbase has publicly advocated for the ending of restrictions from these states, highlighting how the limitations appeared to disproportionately target its services while other platforms remained unaffected.

The company assesses that New Jersey customers alone may have lost out on over $90 million in staking rewards due to these ongoing restrictions.

Expansion of Staking Services

Coinbase expanded its staking services in New York on October 8, 2025, allowing residents to stake various cryptocurrencies again. The company currently maintains specific requirements for customers wishing to stake assets, which include having an active account, residing in a compliant state, and providing necessary tax identification.

As Coinbase navigates these regulatory challenges, its focus appears to be on both compliance and advocacy for the rights of customers in restricted areas as it continues to adapt its operations amid an evolving regulatory landscape.