SEC and CFTC issue joint interpretation for crypto assets

The SEC issued an interpretation on 17 March on how federal securities laws apply to crypto assets and related transactions; the CFTC joined with guidance on consistent Commodity Exchange Act administration. The SEC grouped assets as digital commodities, collectibles, tools, stablecoins or digital securities, and addressed when a non-security asset may become or cease to be subject to an investment contract. It also discusses airdrops, mining, staking and wrapping.

The SEC classifies the action as an interpretive release, not a new statute. It says stablecoins may or may not be securities depending on their features, while digital securities are securities. The guidance also explains that an asset may not itself be a security even when a transaction involving it falls under an investment contract. Firms still need to assess their assets and transactions under applicable law.