SEC Clarifies Crypto Rules, Says Most Assets Aren’t Securities

• SEC says most crypto assets aren’t securities, ending years of regulatory uncertainty.
• New framework classifies digital assets into commodities, stablecoins, tools, collectibles, and securities.
• Proposed safe harbor allows crypto startups to grow before full regulatory compliance requirements.

The SEC clarified that most crypto assets are not securities, ending more than a decade of regulatory ambiguity that pushed crypto firms offshore and stifled domestic innovation. 

SEC Chairman Paul Atkins said, “After more than a decade of uncertainty, this interpretation will provide market participants with a clear understanding of how the Commission treats crypto assets. This is what regulatory agencies are supposed to do: draw clear lines in clear terms.”

CFTC Chairman Michael Selig echoed the sentiment, stating that American builders, innovators, and entrepreneurs had waited too long for clear guidance and that the new interpretation brings that wait to an end.

What the Framework Actually Covers

The joint guidance establishes five categories of digital assets:

• Digital Commodities — assets under CFTC jurisdiction
• Digital Collectibles — NFT-style assets with non-financial utility
• Digital Tools — utility tokens powering specific protocol functions
• Stablecoins — payment stablecoins with defined reserve characteristics
• Digital Securities — assets meeting traditional securities definitions

The interpretation also addresses four areas of persistent legal uncertainty: airdrops, protocol mining, protocol staking, and wrapped assets, giving developers formal guidance on each for the first time.

The Question That Defined a Decade

The most consequential element is the answer to a question that courts and founders have wrestled with for years: can a token stop being a security? The answer is yes. Investment contracts can come to an end, a position the previous administration consistently refused to recognise.

The Safe Harbor That Changes Everything

Atkins also signalled the development of Regulation Crypto Assets, a framework built around a safe harbor provision allowing early-stage projects to raise capital and build networks before triggering full securities registration requirements.

“It is past time for us to stop diagnosing the problem and start delivering the solution,” he said.

Congress is advancing parallel bipartisan legislation to codify the full framework into statute. Questions around enforcement boundaries, investor protections, and safe harbor conditions remain to be resolved. But after a decade of regulation by enforcement, the rulebook is finally being written.

Related: SEC’s Move to Narrow Rule 15c2-11 Raises Questions for Crypto