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
Lilya Tessler, Sidley Austin LLP, on behalf of The Digital Chamber

Security Status of Certain Crypto-Asset (Token) Transactions 		Custody, RFI Responses, Security Status, Trading
  • The letter discusses the criteria for determining whether certain crypto-asset transactions qualify as securities under existing regulations.
  • It outlines the regulatory implications for entities involved in the issuance, trading, and custody of these crypto-assets.
  • The letter emphasizes the need for clear guidelines to ensure compliance and protect investors
Solana Policy Institute, Superstate Inc., and Zagreus Services LLC (dba Orca Creative)

RE: Project Open - Proposing the Open Platform for Equity Networks 		Custody, Public Offerings, Regulatory Sandbox, Security Status, Tokenization, Trading
  • The SEC is requested to exercise its exemptive authority under Section 28 of the Securities Act of 1933 and Section 36 of the Securities Exchange Act of 1934 to permit the issuance and trading of equity securities on public blockchain networks.
  • Project Open Token Shares would be issued via a registration statement filed with the SEC and subject to periodic reporting requirements under the '34 Act.
  • All Token Shares must be held in either non-custodial/self-custodial trader wallets or sub-wallets created for a trader and held by a Broker-Dealer or other appropriate third-party custodian.
     
SEA SWAMI LLC

The Tunney Act 		Custody, Security Status, Trading
  • The Tunney Act governs the judicial review process for consent decrees proposed by the DOJ in antitrust cases, ensuring transparency, public interest, and judicial oversight.
  • The Act's procedural framework could hypothetically be adapted to regulate cryptocurrency markets, addressing concerns like market manipulation, monopolistic practices, or consumer protection.
  • The framework involves mandatory settlement proposals, public disclosure and comment periods, judicial review, interagency coordination, and enforcement and compliance mechanisms.
Johann Kerbrat, Robinhood Crypto

Re: Tokenization of Real-World Assets 		Custody, Security Status, Tokenization, Trading
  • Tokenization of RWAs will transform market structure, reduce risk, and provide numerous benefits to market participants.
  • A new federal regulatory approach is needed to allow tokenization to flourish and provide consistency to the marketplace.
  • Broker-dealers should be permitted to custody and trade tokenized RWAs and other digital assets more freely.
     
Etherealize

Modernizing Transfer Agent Rules for U.S. Leadership in Tokenized Securities 		Custody, RFI Responses, Safe Harbor, Security Status, Tokenization
  • The memo urges the SEC to issue interpretive guidance clarifying that ancillary actors in decentralized blockchain systems are not considered transfer agents.
  • It recommends using the SEC's exemptive authority to create blockchain-based exemptions to existing transfer agent registration mandates.
  • The memo suggests exploring smart contract equivalency to fulfill specific transfer agent functions and establishing standards for blockchain record-keeping systems.
John A. Zecca, Nasdaq, Inc.

Re: What’s in a Name? A Stock by Any Other Name ... Nasdaq Inc.’s Response to “There Must Be Some Way Out of Here” 		Custody, Public Offerings, Regulatory Sandbox, RFI Responses, Safe Harbor, Security Status, Tokenization, Trading
  • The document emphasizes the need for a clear and predictable taxonomy for digital assets to ensure consistent regulation and avoid market distortions.
  • It advocates for a regulatory framework that balances innovation with investor protection, suggesting a light-touch regime for digital assets posing lower risks.
  • The document proposes the establishment of a temporary safe harbor for digital assets not yet clearly classified, allowing them to go to market quickly while pending definitive regulatory classification.
KPMG LLP

RE: Request for response to Crypto Task Force questions 		Custody, Security Status, Tokenization, Trading
  • The document emphasizes the need for clarity in market structure, registration, exchanges, and custody to strengthen the foundation for engaging in the crypto industry.
  • It highlights the importance of principles-based guidance and the role of independent standard-setters like FASB, PCAOB, and AICPA in developing and amending crypto asset accounting and auditing standards.
  • The document discusses the unique auditing challenges presented by crypto assets and the need for clear guidance on what constitutes reliable audit evidence, particularly from decentralized blockchains.
StartEngine

Recommendations from StartEngine on Regulatory Reforms to Support the Tokenization of Securities 		Custody, Public Offerings, Tokenization, Trading
  • Raise the Reg CF cap from $5 million to $50 million and the Reg A limit from $75 million to $250 million.
  • Permit the issuance and trading of tokenized securities under Reg CF, Reg A, and Reg D.
  • Waive Blue Sky compliance for all secondary transactions conducted on SEC-registered ATSs.
Cardano Foundation

Re: Comments on Commissioner Hester M. Peirce’s Statement / Crypto Task Force Questionnaire 		Custody, Public Offerings, Safe Harbor, Security Status, Tokenization
  • The Cardano Foundation advocates for a functional and risk-based taxonomy for blockchain assets, arguing against using decentralization as a criterion for determining whether a blockchain asset is a security.
  • The Foundation emphasizes the importance of regulatory interoperability, suggesting that the SEC align U.S. frameworks with international standards like MiCAR.
  • The Foundation proposes a technology-neutral approach to tokenization, highlighting its potential to enhance market efficiency and transparency.
AICPA

RE: Request for Comment on There Must Be Some Way Out of Here 		Crypto Lending, Custody, Regulatory Sandbox, Security Status, Tokenization, Trading
  • The AICPA emphasizes the need for clear accounting and auditing guidance for digital assets, highlighting the importance of collaboration with FASB to establish standards.
  • The AICPA's Auditing Subgroup is focused on developing guidance for auditors of entities that hold or transact in digital assets, with specific attention to client acceptance, risk assessment, and valuation.
  • The Attestation Subgroup is working on criteria for stablecoin reporting and controls, aiming to enhance transparency and build trust among stakeholders.