The US Securities and Exchange Commission has announced that software providing user interfaces for crypto securities transactions through self-hosted wallets will not be required to register and comply with broker regulations. This statement, the latest in a series of staff views on cryptocurrency, aims to provide clarity for the industry in the absence of permanent rules.
The SEC staff emphasized that websites or software used for securities transactions with self-hosted wallets will not be considered broker-dealers, aligning with the agency's recent stance that developers should be able to create software without triggering regulations. To avoid regulatory oversight, interface creators can follow guidelines such as not soliciting investors for specific transactions and refraining from commentary on potential execution routes.
However, if an interface offers financing, provides investment advice, handles user assets, takes orders, or executes transactions, it will fall under the agency's regulatory purview. The SEC is providing these views as an interim measure while considering various regulatory issues related to cryptocurrency and evaluating feedback received.
Under the current administration, the SEC has reversed its previous resistance to cryptocurrency and is now embracing the technology. The agency is working on developing rules, with wide-ranging proposals nearing the proposal stage.
Meanwhile, the Senate is working on the Clarity Act to cement cryptocurrency regulations into law.