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
Consensys Software Inc.

Re: Staking Services Revenue Recognition Accounting Guidance 		Custody, Regulatory Sandbox, Security Status, Trading
  • Current application of ASC 606 results in misleading gross revenue recognition for staking service providers, treating them as principals rather than agents.
  • Consensys requests SEC guidance to recognize only service fees as revenue, reflecting the economic reality of staking services.
  • Misleading gross revenue treatment impacts financial transparency, investor understanding, and regulatory compliance for staking service providers.
Van Eck Associates Corporation

Letter to the Crypto Task Force 		Crypto ETPs, Custody, Public Offerings, Security Status
  • The letter addresses the regulatory framework for digital assets and emphasizes the need for clear guidelines to ensure compliance.
  • It highlights the importance of investor protection and the role of regulatory bodies in overseeing digital asset transactions.
  • The letter calls for collaboration between industry stakeholders and regulators to develop a robust and adaptable regulatory environment.
Alan Konevsky, tZERO Group, Inc.

Re: Crypto Task Force Meeting with tZERO Group, Inc. – Follow-Up Notes 		Custody, Safe Harbor, Security Status, Trading
  • Establish permanent guidance and rules for broker-dealer self-custody of digital asset securities, building on the SPBD Statement.
  • Clarify the manner in which broker-dealers can retail, custody, and quote non-security crypto assets on alternative trading systems.
  • Issue new guidance to clarify the definition of a digital asset security and its compliance requirements.
BSV Blockchain Association

Public Comment for the SEC Conference - "Emerging Trends in Asset Management" 		Custody, Public Offerings, Security Status, Tokenization, Trading
  • The BSV Blockchain Association advocates for a regulatory framework that distinguishes between digital assets serving as data infrastructure or utility tokens and those operating as financial instruments.
  • The Association supports the development and recognition of "digital commodities" where an asset's value is derived from its underlying blockchain system's utility rather than speculative activity.
  • The BSV Blockchain's Digital Asset Recovery (DAR) framework integrates legal due process with blockchain operations, allowing for lawful asset recovery without altering historical blocks.
Nilmini Rubin, Hedera

Subject: Comments on the SEC Crypto Task Force’s Questions Concerning Safe Harbor from Registration 		RFI Responses, Safe Harbor, Security Status, Tokenization
  • The Hedera Council supports the establishment of a token safe harbor to provide regulatory certainty and transparency for new and existing companies in the digital asset industry.
  • The Council suggests modifying the definition of Network Maturity to include decentralized governance coordinated through a legal entity, termed as a "Decentralized Wrapper," to protect participants from general liability.
  • The Council advocates for retroactive availability of the safe harbor contingent upon full compliance with disclosure requirements to enhance market transparency and investor protection.
Kecheng Lai, Knowpia Inc.

Recommendation Letter - From End User Distribution to Social Mining: Evolving Frameworks for Token Dissemination and Community Engagement in the Digital Asset Economy 		Safe Harbor, Security Status, Tokenization, Trading
  • The "End User Distribution" concept is designed to distribute digital commodities without constituting an offer or sale of a security or commodity.
  • "Social Mining" allows users to earn tokens through non-financial contributions, directly linking token issuance to platform value creation.
  • The STO+ framework proposes a dual-nature token model, where tokens transition from utility to security status based on specific conditions.
Joris Delanoue, Fairmint, Inc.

Comment on SEC Crypto Task Force and Framework for Onchain Equity Securities Markets 		Custody, Regulatory Sandbox, Security Status, Tokenization, Trading
  • Fairmint, Inc. proposes a framework for onchain equity securities markets that emphasizes protocol-level standardization, real-time regulatory observability, and modernized investor protections.
  • The framework includes recommendations for regulatory sandboxes to enable compliant DeFi experimentation and non-custodial broker-dealer frameworks for programmable securities.
  • Fairmint advocates for the recognition of self-custody rights with embedded compliance protections, allowing investors to hold securities directly while maintaining regulatory oversight.
Antonio Lanotte, INATBA

DeFi Self-Regulation: A Proposal for the Industry 		Custody, Regulatory Sandbox, Security Status, Tokenization, Trading
  • The report proposes a structured DeFi self-regulation framework to ensure security, compliance, and long-term sustainability while preserving innovation.
  • It emphasizes the need for real-time financial reporting, decentralized governance models, and standardized security audits to mitigate risks.
  • The report highlights the importance of voluntary self-regulation to achieve market safety standards without hindering industry growth and competitiveness.
Patrick Kirby, Crypto Council for Innovation

RE: Comments on the SEC Crypto Task Force’s Questions Concerning the Security Status of Crypto Assets 		RFI Responses, Safe Harbor, Security Status, Tokenization, Trading
  • The Crypto Council for Innovation (CCI) emphasizes the need for comprehensive legislation for digital assets and blockchain technology to provide clarity, allow for responsible innovation, and protect investors.
  • CCI proposes a regulatory taxonomy for crypto assets based on control, financial returns, and standardization, suggesting that many crypto assets do not implicate securities laws and should not be regulated under them.
  • CCI highlights the importance of recognizing the transformative potential of crypto in improving and empowering the lives of global consumers and encourages collaborative engagement between regulators and the industry.
     
Ernst & Young U.S. LLP

Re: SEC Crypto Task Force request for input 		Custody, Security Status, Trading
  • The Financial Accounting Standards Board (FASB) issued guidance requiring entities to measure certain crypto assets at fair value and reflect changes in net income each reporting period.
  • Auditors should establish the relevance and reliability of information from public blockchains when using it as audit evidence.
  • Institutional custodians often issue SOC 1 Type 2 reports to provide information about internal controls relevant to customers' financial statements.