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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, Safe Harbor, Security Status, Tokenization, Trading
The SEC’s Division of Corporation Finance concluded that proof-of-work (POW) mining activities do not constitute the offer and sale of securities under federal securities laws.
The proof-of-stake (POS) validation process should not be considered an investment contract security under the Howey test, as rewards are compensation for technical validation services, not profits based on the efforts of others.
The issuance of liquid staking tokens (LSTs) should not be considered the offer or sale of a new security, as they are temporary stand-ins for the original staked crypto assets.
Statter Network will issue its native token, STT, through mining without an ICO. The token will be used for DAO governance, allowing token holders to participate in decision-making processes.
Statter Network employs a cross-chain bridge to facilitate the transfer of tokens, smart contract instructions, and information between different blockchains, ensuring interoperability and value exchange.
Statter Network ensures user privacy and transaction confidentiality through multiple layers of protection, including permission control, access authentication, and encrypted storage. It also uses a Segmented Proof of Work (SPoW) consensus mechanism to balance fairness and low energy consumption.
Custody, Public Offerings, Security Status, Tokenization, Trading
DAOs (Decentralized Autonomous Organizations) can be used to quickly raise funds and maintain local ownership of community businesses.
Current legal frameworks prevent non-accredited investors from participating in private markets, but a mature DAO framework could provide new equity ownership opportunities.
DAOs operate within cryptocurrency frameworks, and stablecoin legislation is actively being developed, which could support the growth and stability of DAOs.
The proposal seeks a safe harbor from broker registration requirements for certain decentralized financial applications (DeFi Apps) and non-fungible token (NFT) marketplaces that do not pose traditional broker-related risks.
It outlines conditions for eligibility, including non-custodial design, lack of discretion in transactions, and prohibition on active solicitation or investment recommendations.
The proposal emphasizes the need for clear regulatory guidelines to foster innovation while protecting investors, aligning with historical practices and recent legislative efforts.
Douro Labs requests SEC guidance clarifying that securities laws do not preclude the use of pricing data from decentralized oracle networks for asset valuation, provided the networks meet quality, transparency, and resiliency standards.
The letter emphasizes that decentralized oracle networks can enhance competition, efficiency, and investor protection in the financial data market by providing comprehensive, trustworthy, and affordable pricing data.
Douro Labs suggests that the SEC issue interdivisional FAQs to define decentralized oracle networks, outline their threshold attributes, and confirm their permissible use for regulatory calculations under existing securities laws.
Custody, Public Offerings, Regulatory Sandbox, Security Status, Tokenization, Trading
The whitepaper outlines a multi-jurisdictional compliance strategy that integrates AI-driven risk modeling with real-world asset (RWA) tokenization, ensuring adherence to evolving financial regulations across key markets.
It proposes a legally structured framework for issuing tokenized RWAs, including mechanisms for investor protection, asset verification, and on-chain auditability, aligning with securities law requirements.
The ecosystem incorporates a decentralized governance model with defined roles and responsibilities, including legal accountability for validators and data providers involved in AI model training and financial decision-making.
Regulatory frameworks for tokenized securities must preserve core investor protections—such as best execution, custody safeguards, and conflict-of-interest disclosures—by adapting existing securities laws rather than bypassing them.
Any innovation exemption or regulatory sandbox must include public input, clear disclosure requirements, and structural guardrails (e.g., transaction caps, duration limits, and exit criteria) to prevent regulatory arbitrage and protect market integrity.
Tokenization does not alter the legal nature of an asset; thus, tokenized securities and derivatives must remain subject to existing securities and derivatives laws, with regulatory treatment based on economic substance rather than technological form.
FIA PTG urges the SEC to formally recognize that the Howey test must be applied on a transaction-by-transaction basis, and that most secondary-market crypto transactions do not constitute securities transactions unless under exceptional circumstances.
The group supports a safe harbor framework, as proposed by Commissioner Peirce, to provide legal certainty for crypto projects during their development phase, emphasizing decentralization based on control rather than ownership thresholds.
FIA PTG recommends that tokenized assets and stablecoins be explicitly recognized as eligible collateral under SEC rules, provided appropriate risk management policies are in place.
The SEC should not create a new registration category for platforms trading tokenized securities; instead, it should adapt existing frameworks (e.g., NSE, ATS) to accommodate blockchain-based trading infrastructure.
The SEC should clarify or amend rules to permit side-by-side and pairs trading of securities and non-securities (e.g., stablecoins, bitcoin) on a single platform, treating such transactions as securities trades when appropriate.
A principles-based approach to best execution should be adopted for both offchain and onchain environments, emphasizing transparency, operational integrity, and flexibility in execution standards.
Crypto ETPs, Custody, Public Offerings, Security Status, Tokenization, Trading
The SEC’s May 2025 Staking Guidance affirms that Solo Staking, Delegated Staking, and certain Staking Services do not constitute securities transactions, supporting the legal viability of using LSTs in ETPs under existing frameworks.
LSTs, such as JitoSOL, function as decentralized technological utilities where any expectation of profit arises from autonomous protocol operations rather than third-party managerial efforts, aligning with the SEC’s criteria for non-security classification.
Incorporating LSTs into ETPs does not require altering the traditional grantor trust structure used for cryptoasset ETPs, as LSTs can be treated analogously to direct staking or staking services under current SEC interpretations.
