The SEC Publishes a New Crypto FAQ - What Does It Imply?

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28 Sep 2026Hugh Bernard

The SEC's Division of Corporation Finance Publishes a New Crypto FAQ

In light of the blockage of the CLARITY Act bill in the Senate, U.S. regulatory bodies are organizing to propose clearer and more favorable rules for the development of the crypto ecosystem in their territory, as seen in the recent initiative by the SEC and CFTC regarding its developers.

In this context, the Division of Corporation Finance (Corp Fin) of the Securities and Exchange Commission has just published a new FAQ aimed at answering questions related to its Interpretive Release that came into effect on March 23, with the goal of determining a more precise taxonomy of crypto-assets regarding their potential status as financial securities.

An important point to consider is that this set of questions and answers "reflect the positions of the staff of the Division of Corporation Finance and do not constitute a rule, regulation, or statement of the Securities and Exchange Commission (SEC)". However, this opens up very encouraging prospects, according to attorney Gabriel Shapiro, who specializes in legal and regulatory issues in crypto in the United States.

If you raise funds by selling a token that confers no rights, pay attention to what you assert or promise, and have a functional crypto system, there is now an extremely broad path to escape financial securities regulation. One could even argue that "functionality" is not actually necessary, even though the SEC maintains some ambiguity on this point. Gabriel Shapiro

Essential Distinctions

In fact, this FAQ from Corp Fin seeks to clarify what economically determines the expected value of a token. An estimate that incorporates the promises made and actions taken by a centralized team to achieve profit as constitutive of a classification as a financial security. However, this link can be reassessed downwards or even completely annulled if the success and functioning of the project do not solely depend on these practices.

The question of whether the issuer has achieved functionality would be assessed based on how the issuer has defined or otherwise described functionality, and not according to a general market conception of what constitutes functionality, just as the question of whether the issuer has achieved decentralization would be assessed based on how the issuer has defined or otherwise described decentralization, and not according to a general market conception of what constitutes decentralization. Corp Fin

🗞️ Towards "mass tokenization": the finance of the future will trade 24/7

More concretely, the details published in this FAQ explain that token buyback operations, blockchain upgrades, and associated marketing statements do not automatically transform a token into a financial security. Conversely, when the system is not yet functional, a buyback program presented as a source of yield for holders may be considered different.

Finally, in the case of a "already functional crypto system", the elements of this FAQ indicate that "services aimed at securing, maintaining, improving, or enhancing this system or its functionalities, or promoting network effects (...) would not meet the criteria of the Howey test", used by the SEC to determine whether an operation constitutes an investment contract.

Tokens That Could Replace Stocks?

A situation that raises questions for Gabriel Shapiro. Indeed, he believes that the SEC's new approach could encourage companies to favor fundraising using tokens rather than stocks, in order to retain their capital while benefiting from a less regulatory burden of a tradable asset.

🗞️ Crypto: Why Tokens and Stocks Struggle to Coexist?

I am becoming skeptical about the actual importance that the large-scale adoption of tokenized stocks could take. If you can convince people to buy a token modeled after BNB, HYPE, PUMP, etc., with minimal regulation, why would you voluntarily accept all the constraints associated with selling stocks? Gabriel Shapiro

An extrapolation that goes well beyond the content of the FAQ, but highlights the fact of "knowing how far this reasoning can extend beyond crypto companies".

Sources: SEC, Gabriel Shapiro

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