Catenaa, Tuesday, March 17, 2026- The Securities and Exchange Commission and the Commodity Futures Trading Commission issued joint guidance clarifying that most cryptocurrencies do not qualify as securities under US law, marking a major shift in federal oversight of digital assets.
The 68-page framework outlines how regulators will classify cryptocurrencies, distinguishing between assets considered commodities, stablecoins and other digital instruments. Officials said the guidance aims to reduce uncertainty that has shaped the industry for more than a decade.
SEC Chair Paul Atkins said the framework sets clearer boundaries for enforcement and compliance, while CFTC Chair Kristin Johnson emphasized coordination between the agencies to avoid overlapping jurisdiction.
The guidance introduces a taxonomy based on how digital assets function within their networks. Cryptocurrencies tied to decentralized systems, where value arises from user activity and protocol operations, are classified as commodities rather than securities.
Assets such as Bitcoin and Ethereum fall into this category, according to regulators. The agencies said these networks no longer depend on centralized promoters, placing them outside traditional securities definitions.
Stablecoins are treated separately, with classification depending on whether they are tied to underlying assets and whether users expect profits. Tokens used primarily for utility purposes, such as accessing services or applications, are also excluded from securities status under certain conditions.
Regulators said the framework applies principles from the SEC v. W.J. Howey Co. decision, a long-standing standard used to determine whether an asset qualifies as an investment contract.
Under this approach, a digital asset may be considered a security if it involves an investment of money in a shared enterprise with an expectation of profits derived from the efforts of others. The guidance states that once a network becomes sufficiently decentralized, tokens may no longer meet this definition.
Officials said this interpretation reflects changes in how digital networks evolve over time, particularly as control shifts from developers to users.
The agreement between the two agencies establishes clearer divisions of authority. The CFTC will oversee spot trading of digital commodities, while the SEC will retain jurisdiction over token offerings that meet securities criteria.
A memorandum of understanding signed earlier this month outlines cooperation on enforcement, data sharing and investigations. Regulators said the goal is to streamline oversight and reduce conflicts that have previously complicated enforcement actions.
The guidance also addresses activities such as staking, mining and token distribution. Proof-of-work mining is not considered a securities activity, while certain staking arrangements may fall under commodity derivatives rules depending on structure.
Cryptocurrency markets responded positively to the announcement. Bitcoin and Ethereum posted gains following the release, while trading volumes increased across major exchanges.
Industry participants said the clarity could encourage institutional participation by reducing regulatory risk. Companies involved in digital asset services may now have clearer guidelines for compliance and operations.
Analysts noted that the shift may also support growth in decentralized finance platforms, which rely on tokens that function outside traditional securities frameworks.
The guidance is expected to influence how companies structure new digital assets and services. Developers may focus on designing networks that meet decentralization criteria to avoid securities classification.
At the same time, regulators emphasized that enforcement will continue in cases involving fraud, manipulation or misleading disclosures. The agencies said the new framework does not reduce oversight but refines how it is applied.
The move aligns with broader legislative efforts in Congress to establish rules for digital assets, including proposals addressing stablecoins and market structure.
Other jurisdictions have introduced similar frameworks to regulate cryptocurrencies. The European Union, Singapore and Hong Kong have developed systems that classify digital assets based on their use and risk profile.
US regulators said the new guidance reflects an effort to remain consistent with global approaches while maintaining domestic legal standards.
Legal experts said the guidance could reduce litigation and provide a foundation for future policy development. However, questions remain about how courts will interpret the framework in specific cases.
The agencies indicated that further updates may follow as the technology evolves. For now, the guidance represents one of the most comprehensive federal efforts to define the legal status of cryptocurrencies.
