The U.S. Securities and Exchange Commission has announced that software providing user interfaces for crypto securities transactions with individual wallets will not require registration and regulation as a broker.
This latest statement from the agency's staff on crypto reflects a growing list of views aimed at facilitating the development of the crypto industry in the absence of permanent regulations. According to the SEC, websites or software used for securities transactions with self-hosted wallets will not be considered part of the broker-dealer category, aligning with the agency's recent stance that developers should be able to create software without triggering such regulations.
To avoid being classified as a broker, the creators of these interfaces must ensure they do not solicit investors for specific crypto asset securities transactions and refrain from providing commentary on potential execution routes. However, if the interface offers financing, provides investment recommendations, handles user assets, takes orders, or executes transactions, it will fall within the agency's regulatory scope. The SEC staff has provided these views as an interim measure while the commission continues to consider regulatory issues related to crypto asset securities activities and the feedback received.
Under the current administration, the SEC has shifted its stance on crypto regulation, embracing the technology and working towards creating a more favorable environment. The agency is developing rules to provide greater certainty, with wide-ranging SEC rules nearing the proposal stage.
Meanwhile, the Senate is working on the Clarity Act, which aims to cement crypto regulations into law.