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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.
Self-custody wallets are not considered custodians under U.S. securities law as users retain exclusive control over their private keys and assets.
Self-custody wallets do not meet the definition of an exchange under the Securities Exchange Act of 1934, as they do not match orders or facilitate securities trading among multiple participants.
Self-custody wallets are not brokers under the Exchange Act, as they do not solicit transactions, route orders, match trades, or hold funds in escrow on behalf of clients.
The document emphasizes the need for the SEC to differentiate between Bearer Digital Asset Securities (BDAS) and Tokenized Securities in its regulations, as the risks associated with BDAS do not apply to Tokenized Securities.
It argues that Tokenized Securities should be treated like traditional securities if they incorporate key safety attributes, such as maintaining a redundant secondary record on the blockchain and not being issued in bearer form.
The document urges the SEC to provide new interpretive guidance or no-action relief to allow broker-dealers to use issuers or transfer agents as control locations for Tokenized Securities, facilitating scalable solutions for clearing and custody.
Permissionless or open, public blockchains, including decentralized finance (DeFi), are best positioned to enable the SEC to meet its policy goals relating to capital and digital asset markets.
Safe harbor exemptive relief should extend to the Securities and Exchange Act of 1934, as well as the Securities Act of 1933, and incorporate specific considerations related to DeFi.
The SEC should implement a regulatory sandbox for securities tokenization on open blockchains to develop a new regulatory architecture leveraging open blockchains and complementary technologies.
Nasdaq supports a balanced framework that enables innovative crypto ETP offerings while maintaining regulatory safeguards to protect investors and market integrity.
Nasdaq urges the SEC to modernize its approach and support the development of the digital asset ecosystem on national securities exchanges along more consistent lines.
Nasdaq recommends that the SEC work with national securities exchanges and market participants to establish clear and consistent standards for evaluating crypto ETP proposals.
The Blockchain Association (BA) advocates for an incremental, flexible approach to regulating crypto asset trading, emphasizing the need for the SEC to adapt existing rules to accommodate technological and market innovations.
BA suggests that the SEC should not impose requirements for investors to transact through intermediaries, and should leverage blockchain technology to enhance market efficiency and transparency.
BA recommends specific updates to SEC rules, including relief from certain timing requirements for trade confirmations, modifications to net capital rules for broker-dealers, and allowing blockchain-based books and records for regulatory purposes.
The CAQ supports increased regulatory clarity related to crypto assets and commends the establishment of the Crypto Task Force to advance this objective.
The CAQ encourages the SEC to coordinate with the Financial Accounting Standards Board (FASB) and Public Company Accounting Oversight Board (PCAOB) to provide additional accounting and auditing guidance for crypto assets.
The CAQ highlights the importance of stakeholder education on crypto assets for capital markets stakeholders, including investors and board members.
Custody, Public Offerings, RFI Responses, Security Status
PwC emphasizes the need for a framework that identifies how the characteristics of different crypto assets (e.g., stablecoins, non-fungible tokens) determine their security status.
PwC suggests leveraging existing public offering rules with necessary modifications for crypto assets that meet the definition of a security.
PwC recommends expanding custody-related regulations to provide adequate investor protection for crypto assets, even if they do not meet the definition of a security.
The SEC should clarify that most digital assets and digital-asset transactions are not investment contracts under current law.
The SEC should use its exemptive authority to make clear that digital assets and transactions without forward-looking contractual obligations are not subject to federal securities laws.
If a safe harbor is established, it should be based on the concept of "control" rather than ownership to determine the applicability of securities laws.
Andreessen Horowitz recommends that the SEC establish a taxonomy that clearly identifies when crypto assets may be subject to registration requirements.
Andreessen Horowitz recommends that the SEC issue interpretive guidance that distinguishes between seven types of crypto assets.
Andreessen Horowitz recommends that the SEC provide exemptive relief, where necessary, to: establish a tailored disclosure framework, clarify reporting requirements under the Exchange Act, provide a pathway for decentralization under Exchange Act requirements, and enable onchain transactions of registered crypto assets.
James Wigginton, Coalition for Cooperative Blockchain Organizations
The advent of Decentralized Autonomous Organizations has ushered in a new era of collaborative innovation and community-drive governance.
In the pursuit of establishing web3 as a transformative force, three fundamental principles must be addressed: transparent, dencentralized technology; durable game incentives with aligned economics; and an unchangeable ethos of benevolence toward all stakeholders.
Limited Cooperative Associations emerge as the keystone that harmonizes with the fundamental principles of stability, aligned incentives, and a benevolent ethos.
