The US Securities and Exchange Commission has announced that software enabling users to transact crypto securities through their individual wallets will not be required to register as a broker. This stance is outlined in the agency's latest staff statement on crypto, which aims to provide guidance to the industry in the absence of permanent rules.
According to the SEC, websites or software used for securities transactions with self-hosted wallets will not be classified as broker-dealers, aligning with the agency's recent position that developers should be able to create software without triggering such regulations. To avoid regulatory scrutiny, creators of these interfaces must ensure they do not solicit investors, provide commentary on potential execution routes, offer financing, provide investment recommendations, handle user assets, take orders, or execute transactions. The SEC is working on developing rules to provide greater clarity, with wide-ranging proposals nearing the proposal stage.
In the interim, the agency is providing guidance through staff statements, which, although not carrying the weight of full-fledged rules, offer insight into the regulator's evolving stance on crypto asset securities activities.