Crypto Task Force Written Input

Please find written input submissions to the Crypto Task Force below. The written input is posted without modification. We hope sharing the submissions will help encourage productive dialogue and continued engagement. Please note that the “Key Points” and “Topics” are AI generated. AI can make mistakes, and the Key Points and Topics are not a replacement for you reading the submissions. The Crypto Task Force has not reviewed these AI-generated summaries for accuracy or completeness. If you believe a Key Point or Topic is inaccurate, please email the Crypto Task Force at crypto@sec.gov. The written input provided to the SEC and posted on this page does not necessarily reflect the views of the Crypto Task Force or others in the U.S. Securities and Exchange Commission.

Date Written Input Topic(s) Key Points
DTI Foundation

Re: Public input following announcement of new crypto task force 		Crypto ETPs, Public Offerings, Security Status, Tokenization, Trading
  • The DTI Foundation emphasizes the importance of using the digital Token Identifier (DTI) for unambiguous identification of crypto assets within any future regulatory framework.
  • The DTI is recognized as a global ISO standard and is increasingly adopted for various regulatory reporting requirements in different jurisdictions.
  • The DTI Foundation offers a free service to download the entire DTI registry, ensuring transparency and accessibility for all stakeholders.
Tyler Gellasch, Healthy Markets Association

Re: Submission to the Securities and Exchange Commission Crypto Task Force Roundtable - Between a Block and a Hard Place: Tailoring Regulation for Crypto Trading 		Custody, Security Status, Trading
  • The SEC should apply existing rules from equities and derivatives trading markets to digital assets to promote competition, efficiency, integrity, and fairness.
  • Digital asset managers should be subject to fiduciary duties, custody rules, operational resiliency, and standardized disclosures similar to those for registered investment advisers.
  • Brokers and market makers in digital assets should register with regulators, meet training and expertise requirements, and adhere to best execution and order handling obligations.
     
Andreessen Horowitz, a16z

Re: Comments on the SEC Crypto Task Force’s Questions Concerning the Custody of Crypto Assets 		Custody, RFI Responses, Security Status

  • The Commission should provide new guidance to facilitate custody arrangements for crypto assets, even if only as a temporary measure until it issues new rules.

  • The Commission should permit RIAs to self-custody security tokens and clarify that the self-custody of crypto assets by RIAs would not conflict with the Custody Rule or fiduciary duties.

  • Custodial requirements should clearly distinguish between different categories of crypto assets while ensuring that non-security crypto assets are custodied in a manner that is substantially as secure as crypto asset securities.
Adele Faure & Laura Brookover, OpenSea

Re: Securities Exchange and Broker Status of NFT Marketplaces 		Custody, Security Status, Trading

  • NFTs are not securities under the Exchange Act, primarily because they are collectibles or art purchased for consumption, novelty, or aesthetic value rather than for investment.

  • OpenSea does not qualify as an exchange because it does not bring together multiple sellers of the same asset and does not provide a trading facility or set rules for non-discretionary order interactions.

  • OpenSea is not a broker as it does not solicit investments, negotiate or execute transactions, custody customer assets, or provide financing arrangements, trade documentation, or asset valuations.
Chelsea Pizzola, Cumberland DRW

Re: Crypto Task Force Input: Secondary-Market Trading 		RFI Responses, Safe Harbor, Security Status, Tokenization, Trading

  • Cumberland believes that many secondary-market transactions in native crypto assets are not securities transactions, even if the crypto asset was initially offered and sold as part of an investment contract.

  • Cumberland supports adoption of Commissioner Peirce’s proposed safe harbor or similar relief to alleviate concerns for primary issuance and secondary-market trading of Natively Digital Securities.

  • Cumberland suggests that the SEC should consider providing interpretive or no-action relief from certain aspects of the tests for determining whether securities have a ready market, limited
Anonymous

Bitcoin: Look Again 		Safe Harbor, Security Status, Trading

  • Bitcoin should be reconsidered as a security under the Howey Test, given its nature as an investment contract and the collective for-profit undertaking of the Bitcoin network.

  • The SEC should disavow previous statements that include concepts of decentralization to justify limited regulation of digital assets, as Bitcoin and other network tokens are not decentralized.

  • Other network tokens, similar to Bitcoin, also pass the Howey Test and should be considered securities, requiring full and fair disclosure for investors and the public.
Figure Markets

Re: The Use of YLDS as a Settlement Mechanism for Non-Security Transactions 		Custody, Security Status, Tokenization, Trading

  • The use of Figure Transferable Certificates (YLDS) as a payment mechanism for non-security crypto transactions on the Crypto Platform does not require registration as a broker, securities exchange, or alternative trading system.

  • YLDS are registered securities under the U.S. Securities Act and are issued by a registered investment company, providing protections and disclosures under the Securities Act and the Investment

  • The Crypto Platform facilitates peer-to-peer transactions in non-security crypto assets, and the use of YLDS as a payment method is optional and does not constitute "effecting" securities transactions.
Margaret Rosenfeld, Everstake, Inc.

Letter to the Crypto Task Force 		Custody, RFI Responses, Safe Harbor, Security Status, Trading

  • Everstake requests clear guidance affirming that staking and appropriately structured non-custodial staking services do not constitute securities offerings.
  • The letter outlines why staking and non-custodial staking services meet the criteria of an investment contract under the Howey Test.
  • Everstake urges the Commission to issue formal guidance regarding the application of federal securities laws to non-custodial staking services.
     
Kecheng Lai, Knowpia Inc.

RE: The Future is Here, Now! A Comprehensive Examination of the STO+ Framework and its Regulatory Implications 		Custody, Public Offerings, Regulatory Sandbox, RFI Responses, Safe Harbor, Security Status, Tokenization, Trading
  • The STO+ token model aims to ensure compliance with existing legal frameworks while fostering innovation that benefits both investors and users.
  • The conversion mechanism between ST and ST+ tokens is designed to be lawful and beneficial to investors, aligning with existing securities law requirements.
  • The application of SEC Rule 144 one-year lock-up period to ST+ tokens is deemed inappropriate and counterproductive for the STO+ framework.
Dimitry Jean-Noel II

RE: The Fork in America's Financial Future: From Globalization to Sovereignty 		Regulatory Sandbox, Security Status, Tokenization, Trading
  • The document discusses the structural consequences of deglobalization and the threats posed by dedollarization efforts.
  • It examines the systemic failures in the current financial architecture, including economic, regulatory, and institutional weaknesses.
  • The analysis highlights the need for a future-proof financial architecture that integrates decentralized finance, blockchain-based dollar representations, and asset tokenization under a fair regulatory framework.