SEC drops crypto FAQs while Crypto Mom clocks out 🪙

The US Securities and Exchange Commission updated its policies on how federal securities laws apply to "certain types of crypto assets and certain transactions involving crypto assets," according to a Friday revision to the agency's frequently asked questions first issued in March. The regulator said the guidance was non-binding, had "no legal force or effect, [did] not alter or amend applicable law, and [did] not create any new or additional obligations for any person," and would inform how it applies the Howey test for investment contracts to digital assets.

Under the updated FAQs, token issuers could run buyback programs for customers provided "a crypto system is functional and has no central party," which would not necessarily count as "a representation or promise to undertake essential managerial efforts" under securities law. The SEC applied the same framework to services that "secure, maintain, improve, or enhance such a system or its functionality, or to facilitate network effects," and said staking receipt tokens would not always be classified as securities.

The SEC release followed similar guidance issued last week by the US Commodity Futures Trading Commission for token issuers. Both staff statements came days after the Senate failed to pass a crypto market structure bill that many in Washington had expected to clarify how the two regulators would split oversight of digital assets. SEC Chair Paul Atkins and CFTC Chair Michael Selig said in separate statements that their agencies would continue to address crypto regulation in the absence of legislation from Congress.

Separately, Commissioner Hester Peirce announced on Friday that she would resign from the SEC on Oct. 2 after eight years at the agency. Known in the crypto industry as "Crypto Mom" for her support of digital-asset policies, Peirce is set to join Regent University Law School in Virginia as an associate professor in November. With her departure, the SEC's leadership will consist of Atkins and Commissioner Mark Uyeda, the two remaining members on a bipartisan panel normally composed of five. As of Monday, US President Donald Trump had not named a replacement for Peirce or for the two vacant Democratic SEC seats.