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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.
The Commission should adopt clear, evidence-based standards for reviewing crypto-asset based ETPs, focusing on the size and liquidity of the underlying spot market rather than the existence of a surveillance-sharing agreement (SSA) or a regulated market.
Market capitalization and the number of active spot markets should be prioritized as the most significant factors in evaluating crypto assets for ETP listing.
The historical track records of ETFs registered under the Investment Company Act that obtain exposure to the same assets as a proposed ETP should be highly instructive to the Commission.
Ravi Srivastava, Chief Technology Officer, Akemona, Inc.
Custody, RFI Responses, Safe Harbor, Security Status
Proposes a Qualified Self-Custodian (QSC) framework for Registered Investment Advisers (RIAs) to self-custody digital assets when traditional Qualified Custodian (QC) options are unavailable.
Emphasizes the need for RIAs to document their fiduciary judgment and implement safeguarding principles to protect investors while self-custodying digital assets.
Requests interim regulatory guidance and potential rulemaking to address the regulatory gap and facilitate secure, legal, and practical self-custody solutions for digital assets.
Tokenized securities should be treated as traditional securities, with permissioned assets transferable across whitelisted wallets using smart contracts to enforce lawful transfers and track ownership changes.
Permissionless public blockchains should be allowed for the issuance, trading, and tracking of tokenized securities, with relevant market participants responsible for evaluating the security and soundness of the infrastructure.
Broker-dealers should be allowed to engage in a full array of activities, including custody, trading, and settlement of tokenized securities, without the need for segregation or special licensure.
Deloitte encourages the SEC to align its work with the President’s Working Group on Digital Asset Markets to propose a Federal regulatory framework for digital assets.
Deloitte emphasizes the need for a principles-based framework rooted in established laws and regulations to ensure predictability and adaptability as the digital asset market evolves.
Deloitte highlights the importance of coordination among regulators and standard setters to avoid regulatory fragmentation and reduce the risk of regulatory arbitrage.
Donna Redel, Ivo Entchev, Olta Andoni, and Stephen Rutenberg, Crypto Policy Working Group
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.
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.
