After crypto exchange Kraken announced the closure of its staking service, the onus is now on the 1.23 million ETH staked assets belonging to users. The exchange said the unstaking would only be allowed after the upcoming Shanghai upgrade. The SEC’s crackdown on Kraken had huge repercussions in the crypto market after the settlement led to a price fall. The impact was more so in the proof of stake based cryptocurrencies, as the SEC’s resistance to crypto staking directly impacts these tokens.

The SEC charged Kraken with failing to register the offer and sale of their crypto staking program. As a result, the exchange offered to discontinue the staking service and also pay pay $30 million in penalties. This led to a sell off in the crypto market due to fears of further crackdown on other crypto exchanges. Essentially, the SEC is discouraging the staking program as the exchanges are devoid of proper disclosures and safeguards as per securities laws.

Meanwhile, there is an undercurrent sentiment of buy the dip currently as fears of further price crash grow. However, considering the bullish scenario with rising crypto prices seen in January 2023, there could be resistance to the regulatory pressure in coming days. Also, Ethereum (ETH) traders were hoping for significant upside around the upcoming Shanghai upgrade scheduled for March 2023.