On March 17, 2026, the Securities and Exchange Commission (SEC), joined by the Commodity Futures Trading Commission (CFTC), issued an interpretive release clarifying how existing federal securities laws apply to certain crypto assets and transactions involving crypto assets. The release aligns with remarks made last year by SEC Chair Paul Atkins signaling a shift in the commission’s regulatory posture toward crypto regulation and the limits of its jurisdiction. It is significant not only for token classification under the federal securities laws, but also for U.S. crypto market structure more broadly, since it signals a coordinated SEC–CFTC framework for distinguishing securities from crypto assets that are not securities and for clarifying when such assets may be treated as commodities.
The SEC’s New Token Taxonomy
The release establishes a classification-driven framework for assessing crypto assets under the federal securities laws, creating a five-category taxonomy and explicitly noting that three categories are not securities.
The release describes five core categories of crypto assets:
- Digital commodities. Crypto assets that are intrinsically linked to and derive their value from the programmatic operation of a crypto system that is functional, rather than from the expectation of profits from the essential managerial efforts of others.
- Digital collectibles. Crypto assets designed to be collected and/or used and that represent or convey rights to artwork, music, videos, trading cards, in-game items, or similar content. These assets do not have intrinsic economic properties or rights such as passive yield or claims on future income, profits, or assets of a business.
- Digital tools. Crypto assets that perform practical functions, such as memberships, tickets, credentials, title instruments, or identity badges, are designed for use in connection with crypto systems.
- Payment stablecoins. Crypto assets designed to maintain a stable value relative to a reference asset such as the U.S. dollar. For permitted payment stablecoins subject to the GENIUS Act, the offer and sale of such assets does not implicate the offer and sale of a security.
- Digital securities. Financial instruments that fall within the definition of a security but are represented or maintained on a crypto network.
Investment Contracts and Crypto Assets
A central feature of the release is the SEC’s effort to distinguish between a crypto asset that is not a security and an investment contract associated with that asset. As Atkins noted last year, “once the investment contract can be understood to have run its course, or expires by its own terms,” trading in the token should not continue to be treated as a securities transaction solely because the token was originally issued as part of one.
The release largely adopts that view. In assessing whether a crypto asset that is not a security is subject to an investment contract, the SEC places substantial weight on how the issuer markets and promotes the arrangement, including the source, timing, and manner of any representations or promises about the asset. Explicit issuer statements in agreements, websites, official social media accounts, direct communications, regulatory filings, or white papers are highlighted as particularly relevant.
The release explains that a crypto asset that is not a security and is initially sold as part of an investment contract may not be subject to an investment contract—and the securities laws—indefinitely. Once purchasers no longer reasonably expect the issuer’s representations or promises to remain connected to the asset, the asset may “separate” from the investment contract.
The SEC identifies two principal paths to separation: (1) fulfillment of the issuer’s representations or promises; and (2) failure or abandonment such that purchasers no longer reasonably expect the issuer to perform the promised essential managerial efforts.
Mining, Staking, and Network Participation
The release addresses protocol mining and staking and concludes that these activities do not involve the offer and sale of a security.
As for self-mining and participation in mining pools, the release states that these activities result in rewards as payment for services to the network and not profits from the managerial efforts of others.
CFTC Coordination and Market Structure Implications
The release is notable in that it was jointly issued with the CFTC and indicates increasing coordination between the agencies.
It states that certain crypto assets that are not securities may fall within the definition of commodity under the Commodity Exchange Act. This is significant for market participants operating in spot, derivatives and intermediary markets.
The document also underscores that, as of January 29, 2026, “Project Crypto” became a joint SEC–CFTC effort intended to “harmonize federal oversight of crypto asset markets,” which strengthens the message that federal crypto policy is moving toward coordinated cross-agency classification and oversight rather than parallel, potentially inconsistent approaches.
This continued coordination is especially notable given the ongoing legislative debate over crypto market structure, including the CLARITY Act, which would shift substantial crypto regulatory responsibility to the CFTC and could supersede aspects of the release. In the interim, the SEC and CFTC are following their directive from the President’s Working Group on Digital Asset Markets to “use their existing authorities to provide fulsome regulatory clarity,” in the absence of congressional action.
Practical Implications for Market Participants
Although framed as interpretive guidance, the release is likely to become a central reference point for token structuring, crypto product design, and regulatory enforcement priorities going forward. It has immediate implications for issuers, trading platforms, custodians, brokers, and staking providers.
Market participants should:
- Revisit token classification frameworks. Firms should assess whether existing token reviews align with the release’s taxonomy, including how assets are defined across the five categories and whether internal classifications appropriately distinguish crypto assets that are not securities from digital securities.
- Evaluate issuer statements and marketing practices. Because the release places substantial weight on issuer representations and promises, firms should closely review white papers, website disclosures, social media statements, investor communications, and marketing materials for language that could create or prolong an expectation of profits based on managerial efforts.
- Assess a crypto asset’s “separation” from its investment contract. For crypto assets that may initially have been sold as part of an investment contract, firms should assess whether the relevant promises have been fulfilled, abandoned, or otherwise ceased to be reasonably connected to the asset, potentially supporting a “separation” analysis for later transactions.
- Consider CFTC-facing consequences. If an asset is more likely to be treated as a crypto asset that is not a security, that may increase the relevance of the Commodity Exchange Act and CFTC oversight, particularly for firms involved in derivatives, leveraged products, market intermediation, or platform operations.
If you have any questions, or would like additional information, please contact one of the attorneys on our Securities Litigation, Financial Services, or White Collar, Government & Internal Investigations team.
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