SEC and CFTC Issue Joint Interpretation on Crypto Asset Classification, USA, March 2026

On March 17, 2026, the U.S. Securities and Exchange Commission (SEC) issued an interpretive release clarifying how federal securities laws apply to certain crypto assets and transactions. The Commodity Futures Trading Commission (CFTC) joined the release, confirming it will administer the Commodity Exchange Act consistently with the SEC's interpretation. The release became effective March 23, 2026, upon publication in the Federal Register.

The controlling authority is SEC Interpretive Release Nos. 33-11412 and 34-105020, File No. S7-2026-09, titled "Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets." The release establishes a five-category token taxonomy: digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. It addresses how a non-security crypto asset may enter or exit investment contract analysis under SEC v. W.J. Howey Co., 328 U.S. 293 (1946), and clarifies treatment of airdrops, protocol mining, protocol staking, and asset wrapping.

Token issuers, exchanges, broker-dealers, investment advisers, and wallet providers must map their assets against the five-category taxonomy. Assets qualifying as digital commodities or digital tools fall outside SEC jurisdiction and within CFTC authority under the Commodity Exchange Act. Assets qualifying as digital securities remain subject to full registration and disclosure requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934. DeFi protocols and other service providers handling digital securities must evaluate their registration obligations as broker-dealers, exchanges, or transfer agents.

The release describes itself as a bridge pending bipartisan digital asset market structure legislation, which both agencies expect Congress to advance. Multi-functional tokens that shift classification over their lifecycle present unresolved edge cases. The CFTC's concurrent staff guidance (Release 9200-26, March 20, 2026) on crypto-related registrant activities supplements the release but is staff-level and does not carry the interpretive release's authority.

Our firm advises on matters arising from this interpretation and maintains a dedicated partner network covering token classification analysis, exchange and broker-dealer registration, DeFi legal structuring, digital asset custody, stablecoin issuance, and blockchain protocol governance. We invite clients and counterparties to reach out for guidance.

Source: SEC Interpretive Release Nos. 33-11412 and 34-105020, File No. S7-2026-09, "Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets," issued March 17, 2026, effective March 23, 2026. https://www.sec.gov/rules-regulations/2026/03/s7-2026-09. Confirmed April 2, 2026.

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