SEC Releases Digital Asset Guidance

The SEC announced the release of detailed digital asset guidance on Wednesday, including a published framework designed to help token issuers and others determine when crypto tokens qualify as securities. In a statement announcing the news, the new framework was described as an “analytical tool to help market participants assess whether the federal securities laws apply” to any given digital asset.

The statement stressed the importance of providing greater clarity for those market participants:

As financial technologies, methods of capital formation, and market structures continue to evolve, market participants should be aware that they may be conducting activities that fall within our jurisdiction.  For example, market participants may engage in activities that require registration of transactions and persons or entities involved in those transactions.  Even if no registration is required, activities involving digital assets that are securities may still be subject to the Commission’s regulation and oversight.

According to the SEC’s announcement, guidance contained in the framework may be applicable to entities engaged in a broad range of crypto token-related activities, including trading, marketing, promoting, selling, offering, buying, holding, storing, or offering various financial services related to digital assets.

The announced framework is apparently a Staff product rather than a rule or regulation, and today’s statement confirmed that the ‘Commission has neither approved nor disapproved its content.”