The US Securities and Exchange Commission said that software that sets up user interfaces that allow trading of crypto-securities through individuals’ wallets does not need to be registered and regulated as a broker.
In the latest of the agency’s staff statements on crypto — now a broad list of views intended to allow the crypto industry to move forward in the absence of permanent rules — SEC staff said Monday that the websites or software used by people pursuing securities transactions with their self-hosted wallets would not, per se, be considered to belong to the broker-dealer category. That follows the agency’s recent stance that developers should be able to write software without triggering such rules.
The agency provided a checklist of measures the creators of these interfaces can take to keep them out of the regulatory box, including that it “does not encourage investors to engage in any specific securities transactions in cryptoassets” and “does not comment on any potential execution routes displayed to a user.”
If the interface offers financing, makes investment recommendations, handles user assets, takes orders or executes transactions, it is no longer outside the agency’s regulatory reach.
“Staff provides its views as an interim step while the commission continues to consider various regulatory issues related to activities related to cryptoassets and the feedback it has received,” the document said.
Under the administration of President Donald Trump, who has demanded that his executive branch clear an easier path for the emergence of friendly crypto regulation, the leadership of the SEC has reversed previous resistance and embraced the technology. Even before the arrival of SEC Chairman Paul Atkins, a number of pro-crypto statements began to appear, clarifying the regulator’s new view that various assets would not be considered securities or would not trigger supervisory requirements. But these statements do not carry the weight and greater duration of full-fledged rules.
In the meantime, Atkins’ agency is working on such regulations. Comprehensive SEC rules are nearing the proposal stage at the agency, he said. Although the Senate continues to work on the Clarity Act that would cement crypto regulations into law, the agency is working on temporary measures to provide the agency with ample security.
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