SEC Clarifies the Application of Federal Securities Laws to Crypto Assets
The U.S. Securities and Exchange Commission has issued long-awaited clarification on the application of federal securities laws to the digital asset market, specifically how the law applies to certain crypto assets and transactions involving crypto assets.
The guidance seeks to end over a decade of regulatory ambiguity by sorting crypto assets into two primary categories: tokenized securities and non-security crypto assets.
Paul S. Atkins, chair of the SEC, said that most crypto assets are not themselves securities. “This is what regulatory agencies are supposed to do: draw clear lines in clear terms,” Atkins stated, noting that the guidance also recognizes that investment contracts “can come to an end.”
The SEC’s 68-page guidance defines four distinct categories of non-security crypto assets:
- Digital commodities, which includes assets such as Bitcoin, Ether, Solana, XRP, and Dogecoin;
- Payment stablecoins;
- Digital collectibles; and
- Digital tools.
Beyond broad classifications, the commission provided clarity on specific technical activities that have occupied legal gray areas. The guidance addresses the application of securities laws to airdrops and wrapping of non-security assets, as well as protocol mining and protocol staking.
Whether a digital asset is subject to an investment contract – and thus potentially applicable federal securities laws—will depend largely on the specific promises made by its issuer.
Legislative and Industry Impact
The guidance is intended to serve as a “bridge” for American entrepreneurs while Congress works to advance the CLARITY Act, legislation that would codify a comprehensive digital asset market structure framework. While the bill passed the House last year, it remains stalled in the Senate amid disputes over stablecoin interest payments and other provisions.
In a show of interagency alignment, the U.S. Commodity Futures Trading Commission joined the SEC’s guidance on digital assets, committing that the Commodity Exchange Act will be administered in a consistent manner. The joint statement marks the second time this month the two agencies have acted in concert. Last week, the SEC and CFTC signed a memorandum of understanding to harmonize the regulation of U.S. financial markets.
Michael S. Selig, chair of the CFTC, said the latest joint action marked a milestone for “American builders, innovators, and entrepreneurs.”
The full guidance is scheduled for publication on the SEC’s website and in the Federal Register.
The latest SEC guidance complements Atkins’ previous remarks and priorities as chair. In December 2025, Atkins addressed the fundamental tension between national security interests and individual financial privacy in the age of digital assets during the Crypto Task Force’s roundtable. Stressing that his views were his own and not necessarily those of the SEC, he warned that if improperly regulated, the inherent transparency of public blockchains could transform the ecosystem into the “most powerful financial surveillance architecture ever invented,” capable of becoming a “financial panopticon.”
In November 2025, Atkins laid out a roadmap to bring clarity and restraint to the regulation of digital assets through an initiative dubbed Project Crypto. Speaking at the Federal Reserve Bank of Philadelphia, Atkins argued for a token taxonomy grounded in the economic realities of digital asset use, aiming to resolve a decade of regulatory ambiguity that has frustrated developers and investors alike.
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