The US Securities and Exchange Commission has announced that software enabling user interfaces for cryptocurrency securities transactions via individual wallets will not require registration or regulation as a brokerage firm. This statement, part of the agency's ongoing series of crypto-related views, aims to provide clarity and allow the crypto industry to progress in the absence of formal rules. The SEC staff emphasized that websites or software used for securities transactions with self-hosted wallets will not be classified as broker-dealers, aligning with the agency's recent stance that developers should be able to create software without triggering such regulations.
To avoid being considered a broker-dealer, the interface must not solicit investors for specific crypto asset securities transactions and must not provide 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 under the agency's regulatory purview. The SEC is providing these views as an interim measure while it continues to consider various regulatory issues related to crypto asset securities activities and the 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 formal rules, with wide-ranging SEC rules nearing the proposal stage. In the meantime, the agency is implementing interim measures to provide greater certainty.
The Senate is also working on the Clarity Act to cement crypto regulations into law.