- Most crypto tokens aren’t securities, per the SEC’s Peirce
- Safe harbor and airdrop exemptions under consideration
- Utility tokens shouldn’t face securities registration
At the recent SEC Speaks event, US SEC Commissioner Hester Peirce, also known as the Crypto Mom, made a bold and clarifying statement: most crypto assets should not be considered securities. Peirce, who leads the agency’s Crypto Task Force, stressed that regulatory clarity is essential as the crypto space continues to evolve.
In her address, Peirce explained that crypto tokens that do not convey economic rights or interests in a business entity should not fall under federal securities laws. Instead, she pointed out that design and use cases matter when categorizing digital assets. This stance supports the broader industry view that a one-size-fits-all approach to regulation could hinder innovation.
SEC Task Force Pushes for Flexible Crypto Frameworks
Commissioner Peirce detailed several steps taken by the SEC to engage with the crypto community. She indicated that the agency has conducted more than 100 meetings with leaders from the crypto industry with the purpose of learning about market dynamics and regulatory issues. She also admitted, though, that a lot of work remains.
One of the highlights of her address was her call for bespoke regulatory strategies, in particular for airdrops, meme coins, and non-security tokens. Peirce reiterated that economic realities, not just formal structures, should guide the classification of crypto assets.
She stated:
“Crypto assets that do not represent economic rights or an interest in a business entity and are solely for use or consumption should not be subject to federal securities laws.”
Consonant with this perspective, Peirce rejected the idea that meme coins are securities per se, contending that tokens intended for mere use, amusement, or utility should be treated differently from investment vehicles.
Proposed Measures: Safe Harbors and Airdrop Exemptions
To further bridge the gap between regulation and innovation, Peirce proposed introducing a “safe harbor” framework. This would allow certain crypto projects to operate without full securities registration, provided they meet specific guidelines. The goal is to give innovative startups room to grow while still being accountable.
Peirce also suggested that the SEC could exclude certain airdrop events from being labeled as securities offerings, a move welcomed by many in the industry. These measures would ease compliance burdens and reduce legal uncertainties that many blockchain-based startups currently face.
She stressed the importance of not leaving critical regulatory decisions solely in the hands of courts. “The Commission should clarify when a crypto asset is no longer part of an investment contract,” she said, addressing ongoing concerns about secondary market classifications.
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