For the first time, the U.S. Securities and Exchange Commission is seeking to clearly define different types of crypto-assets and how regulators will treat them, publishing these new standards on Tuesday alongside sister agencies responsible for commodities.
The SEC’s interpretive guidance has not yet carried the weight of a formal new rule, but it has been promised by its new leader, Chairman Paul Atkins, who was appointed by President Donald Trump. It was released in partnership with the Commodity Futures Trading Commission, just days after the two agencies agreed to a formal relationship and plan to regulate cryptocurrencies and other industries as close partners.
“After more than a decade of uncertainty, this explanation will provide market participants with clarity on how the Commission treats crypto-assets under federal securities laws,” Atkins said in a statement.
Democratic appointee Gary Gensler, the former chairman of the U.S. Securities and Exchange Commission, has refused to commit to tailoring policies for the cryptocurrency industry, leaving his regulator with a perennial gap in certainty in the world’s most important market.
Atkins said Tuesday’s new Token Taxonomy interpretation takes a position rejected by Gensler’s agency: “Most cryptoassets are not securities themselves.”
Speaking at the Digital Chamber of Commerce DC Blockchain Summit, he said the SEC created four categories of tokens.
“The explanation then clarified that only one crypto-asset class remains subject to securities laws, namely digital securities, which are traditional securities in new technologies,” he said. “This distinction returns the SEC to its core mission and statutory authority to protect investors who participate in securities transactions.”
Furthermore, those investment contracts that are securities don’t necessarily stay that way forever, he said.
“We are no longer the Securities and Everything Commission,” he said Tuesday at the Chamber of Digital Commerce’s DC Blockchain Summit, just minutes after the new standards were released. This statement drew loud applause from the crypto crowd.
The guide aims to define digital commodities, digital collectibles, digital instruments, stablecoins and digital securities. It also clarifies how U.S. securities laws should treat airdrops, protocol mining, protocol staking, and packaging of non-secure cryptoassets.
“American builders, innovators and entrepreneurs have long awaited clear guidance from federal securities and commodities laws on the status of crypto-assets,” said CFTC Chairman Mike Selig.
Atkins said legislation enacted by Congress to enact new crypto laws will be the only way to guarantee a lasting policy shift in support of digital assets.
