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
Professor Edward Lee, Santa Clara University School of Law

Re: Recommendations for Treatment of NFTs for Digital Art Under Securities Law and the First Amendment 		Public Offerings, Security Status, Tokenization
  • NFTs for digital art do not constitute investment contracts under the Securities Act of 1933.
  • Requiring securities registration of NFTs for digital art violates the First Amendment by imposing prior restraints on creators of artistic expression.
  • The SEC should issue public guidance stating that NFTs used for digital art do not constitute securities or “investment contracts.”
Kechang Lai, Knowpia Inc.

Recommendation Letter - Supplementary Clarification No. 3 - Recommendation for Operational Structure and Clarification of STO+, ST, and ST+ Mechanisms 		Custody, Security Status, Tokenization, Trading
  • ST tokens are subject to lock-up periods under Reg D, Reg CF, and other relevant securities laws.
  • KYC and AML verification are mandatory for all ST token holders before receiving their tokens.
  • Smart Contracts govern the issuance, transfer, and conversion of ST and ST+ tokens, ensuring compliance with SEC regulations.
Ronald Hale

Letter to the Crypto Task Force 		Custody, Public Offerings, Regulatory Sandbox, Security Status, Tokenization, Trading
  • The SEC should implement a ban list of individuals and entities known for exploiting investors, similar to stock market practices, and require regulated entities to screen against it.
  • Stablecoins need regular auditing and reserve transparency, while meme coins should face stricter scrutiny due to their speculative nature.
  • DAOs should have clear governance and voting transparency, and mining regulations could promote sustainable practices.
     
Global Legal Entity Identifier Foundation (GLEIF)

A Response by the Global Legal Identifier Foundation (GLEIF) to the Securities and Exchange Commission’s Crypto Task Force 		Custody, RFI Responses, Security Status, Tokenization, Trading
  • The LEI (Legal Entity Identifier) is a 20-character, alpha-numeric code based on the ISO 17442 standard, which uniquely identifies a legal entity and is nonproprietary.
  • The vLEI (Verifiable Legal Entity Identifier) is a cryptographically verifiable version of the LEI, providing automated and nonrepudiable verification of an organization’s identity and the persons acting on its behalf.
  • The costs of obtaining and renewing an LEI are governed by a cost-recovery model, requiring review and approval by GLEIF.
Kecheng Lai, Knowpia Inc.

Recommendation Letter 		Security Status, Tokenization
  • Recommendation for exemption from locking period for Social-Mined Tokens (ST+) under STO+ classification.
  • Definition and distinction between ST (Security Token) and ST+ (Social Mining Token).
  • Proposal for regulatory distinction where ST+ tokens retain utility-only classification during non-tradable, in-platform phase.
Andreessen Horowitz, a16z

Re: Recommendations Regarding a Safe Harbor and Crowdfunding Regime for Collectible Tokens (NFTs) 		RFI Responses, Safe Harbor, Security Status
  • The document recommends the creation of a safe harbor to exclude ordinary transactions of collectible tokens from federal securities laws.
  • It proposes new crowdfunding regulations for transactions of collectible tokens that may engender risks addressed by federal securities laws.
  • The document emphasizes that collectible tokens generally do not have the inherent characteristics of securities and should not be subject to federal securities laws.
Figure Markets

Submission to SEC Crypto Task Force 		Crypto Lending, Custody, Public Offerings, Regulatory Sandbox, RFI Responses, Safe Harbor, Security Status, Tokenization, Trading
  • The SEC should clarify the security status of crypto assets like stablecoins, wrapped tokens, and NFTs to foster innovation and protect investors.
  • Tailored disclosure requirements for specific non-security crypto asset categories should be established to ensure transparency and investor protection.
  • A safe harbor provision, such as Rule 195, should be considered to encourage blockchain development within regulatory parameters.
Alternative Investment Management Association (AIMA)

Re: AIMA written input to the SEC’s Crypto Task Force 		Crypto ETPs, Crypto Lending, Custody, Public Offerings, Regulatory Sandbox, RFI Responses, Safe Harbor, Security Status, Tokenization, Trading
  • AIMA recommends the SEC adopt a clear, principles-based regulatory approach toward crypto assets, recognizing their diverse nature and use cases.
  • AIMA urges the SEC to provide clear custody guidelines for RIAs and other institutional investors, emphasizing the need to withdraw the proposed Safeguarding Rule.
  • AIMA suggests that the SEC consider adopting a version of Rule 195 to provide clarity on when a token sale ceases to be an investment contract and when a network achieves sufficient decentralization.
Asia Web3 Alliance Japan

Proposal for U.S.–Japan Collaboration on Tokenized Economy and Web3 Innovation 		Regulatory Sandbox, Safe Harbor, Tokenization, Trading
  • The proposal emphasizes the need for regulatory clarity and interoperability of frameworks to support the development of compliant and inclusive tokenized markets.
  • It suggests the creation of a U.S.–Japan Tokenization and Web3 Regulatory Collaboration Program to harmonize token classification frameworks and promote regulatory interoperability.
  • The proposal advocates for the introduction of a safe harbor mechanism in Japan, similar to the U.S. model, to allow startups to test projects in a controlled sandbox environment with a path to full compliance.
Lido Labs Foundation

Re: Response to RFI of Crypto Task Force 		RFI Responses, Safe Harbor, Security Status
  • Governance tokens provide essential utility for decentralized blockchain networks and should not be classified as securities.
  • Liquid staking tokens (LSTs) are akin to warehouse receipts for commodities and do not implicate federal securities laws.
  • The SEC should provide legal clarity on the status of LSTs to ensure market certainty.