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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.
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.
James Wigginton, Coalition for Cooperative Blockchain Organizations
Turbulence in the crypto and blockchain markets over the past year has shed light on how web3 companies share ownership in digital assets, including through tokens.
Builders and investors should consider adding cooperatives to their ownership structures.
The SEC has consistently declined to classify cooperative memberships as securities, enabling cooperatives to distribute ownership to users quickly and easily, while also offering important protections to their members.
James Wigginton, Coalition for Cooperative Blockchain Organizations
A growing number of decentralized autonomous organizations use cooperatives or similar legal entities as a wrapper (e.g., Coinage Media, Collab.Land, Opolis, SporkDAO).
For decades, the Securities and Exchange Commission has treated non-transferable cooperative memberships and similar interests as non-securities (e.g., Green Bay Packers stock), but SEC regulations do not provide an explicit “safe harbor” for such membership interests, which means DAOs that issue non-fungible, non-transferable membership tokens must either obtain an SEC no-action letter with respect to the membership tokens or issue membership tokens subject to the risk of SEC enforcement.
The SEC rulemaking proposed herein would provide a “safe harbor” for non-transferable memberships that meet certain criteria.
The memo highlights a potential conflict between the SEC's requirements for Covered Stablecoins and state financial authority requirements, particularly those of the NYDFS.
It suggests that the SEC staff contact state agencies to align on Reserve requirements for Covered Stablecoins to avoid violations of federal securities laws.
The memo recommends clarifying the SEC's Statement on Stablecoins to ensure issuers understand the need for potential registration under the Exchange Act, Investment Company Act, and Advisers Act.
Staking and Staking Services do not constitute securities transactions under federal securities laws, as they do not meet the criteria for investment contracts or notes.
The provision of Staking Services involves technical activities that secure blockchain networks and are compensated through protocol-defined rewards, not managerial efforts.
Regulatory clarity is requested to confirm that staking activities do not constitute the offer and sale of securities, which would help the industry flourish with U.S. participants.
Custody, Public Offerings, RFI Responses, Security Status, Tokenization, Trading
Broadridge supports the development of tailored disclosure requirements for crypto assets to enhance investor protection and suggests that disclosures should include both traditional financial information and crypto-specific details.
The letter emphasizes the importance of frequent updates on material information for crypto assets, with a recommendation for monthly updates or updates as changes occur.
Broadridge highlights the need for greater financial literacy education to help investors understand the unique attributes and risks associated with crypto assets.
StableCoins must develop and utilize mechanisms to maintain a stable value relative to a reference asset, which may involve holding a fixed amount of the reference asset or maintaining an asset base that parallels the reference asset.
If a StableCoin platform's business involves investing or trading in securities, it may be required to register as an investment company under the Investment Company Act of 1940, unless it qualifies for an exemption.
The SEC has a regime for investment companies aimed at maintaining a stable value, such as money market funds, which includes diversification, transparency, and valuation policies.
