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Everyone has a different idea on how to report staking income.  In my opinion reporting it as rental income is the best fit with the existing regulations.  

According to Notice 2014-21, virtual currencies are treated as property, and all general rules applicable to property are applicable to virtual currencies.

According to Reg § 1.61–8, gross income includes rentals received or accrued for the occupancy of real estate or the use of personal property.

Should be the end of it except for those 1099-MISC forms completed incorrectly.  I do say incorrectly because I'm not aware of any regulation that tells them to put it in Block 3, they just do it.

Please note:  I am not a tax expert, so do your own research or consult a tax expert.  The way I took care of this issue is I filled a Form 8275 disclosure statement with my return.  

Form 8275, Part 1:

First line block (a) of Form 8275 I listed "Notice 2014-21"; Block (c) I said "Cryptocurrency staking income is reported consistent with Notice 2014 and Reg § 1.61–8", Block (d) "Sch 1", Block (e) "8K", Block (f) the amount of staking income not reported in a 1099-MISC.

The next two lines I flagged the two 1099-MISC forms I got as being completed in error and not consistent with Notice 2014-21 and Reg § 1.61–8.

Block (a) if each "Reg § 1.61–8', Block(c) " 1099-MISC from *****(TIN*****) staking income incorrectly entered in Block 3 instead of Block 1", Block (d) "Sch 1", Block (e) "8K". Block (f) "USD amount in 1099-MISC"

Form 8275 Part II

Line 1, "According to Notice 2014-21, virtual currencies are treated as property, and all genral rules applicable to property are applicable to virtual currencies."

Line 2, "According to Reg § 1.61–8, gross income includes rentals received or accrued for the occupancy of real estate or the use of personal property."

Line 3, "Cryptocurrency staking involves the loaning of personal property to a blockchain node or other platform for their use in running the node or other platform.  Based on the language of Notice 2014-21 and Reg § 1.61–8, cryptocurrency staking clearly is the renting of personal property.  Therefore, such rental income needs to be entered as such on Schedule 1, Part 1, Line 8K."

Line 4, "For 2021, I received two 1099-MISC forms completed incorrectly.  One was from *****(TIN****) for $****** and the other was from ******(TIN******) for $*****.  Income was entered in Block 3 instead of Block 1 in the 1099-MISC and not consistent with Notice 2014-21 & Reg § 1.61–8."

Line 5, "In order to correct the errors on the two 1099-MISCs of line 4 above, I entered the amount of each 1099-MISC in TurboTax in 1099 Block 1 instead of Block 3.  This was necessary to properly characterize this staking income with my other staking income and make the reporting Income consistent with Notice 2014-21 and Reg § 1.61–8."

Line 6, "Total cryptocurrency staking rental income reported on Schedule 1, Line 8K is the sum of income earned without 1099-MISC issued plus the two 1099-MISCs received ($********+$*****+$***** = $******)."

So that is how I took care of the issue.  No guarantees it's the best approach.  But reporting as rental income does seem the best fit the limited existing guidelines.  Also, deductible expenses are handled a bit differently for different types of income.  So it could make a difference.  But in general, the tax comes out the same anyhow.  

I don't see any way the IRS could complain about reporting this way because it's their own words that are being used.  At least not unless/until there is a change in the law/regulations.  Their main concern is that the tax due is paid which is boing done.  

You might also fire off a letter to whoever sent you a 1099-MISC with the income in Block 3 and ask them to please start doing it according to existing regulations and place it in Block 1.  If enough people do this, maybe they will listen.