The United States Securities and Exchange Commission issued broad guidance for the cryptocurrency industry, stating that “most crypto assets” would not be considered securities. SEC Chair Paul Atkins announced the clarification, which distinguishes assets meeting the definition of an investment contract. The guidance specifies that protocol mining, staking, and token airdrops do not constitute securities. The Commodity Futures Trading Commission stated it would align its administration of the Commodity Exchange Act with the SEC’s new interpretation.
The United States Securities and Exchange Commission issued broad guidance towards the cryptocurrency industry on Tuesday. SEC Chair Paul Atkins declared that “most crypto assets” would not be considered securities under this framework.
The guidance provides distinctions for which assets would not meet the definition for securities. It also clarifies what would make an asset meet that definition as an investment contract.
Furthermore, the guidance notes that protocol mining, staking, and crypto airdrops do not meet the securities definition. These activities include tokens sent to a protocol’s users and contributors.
“After more than a decade of uncertainty, this interpretation will provide market participants with a clear understanding of how the Commission treats crypto assets under federal securities laws,” said Atkins in a statement. “This is what regulatory agencies are supposed to do: draw clear lines in clear terms.”
“It also acknowledges what the former administration refused to recognize—that most crypto assets are not themselves securities,” he continued. Atkins stated the effort serves as an important bridge for entrepreneurs and investors as Congress works on legislation.
In a statement released soon after, the Commodity Futures Trading Commission said it would administer its act consistent with the SEC’s interpretation. The CFTC added this was a major step to provide greater clarity regarding the treatment of crypto assets.
