The SEC has unveiled a new cryptoasset classification system.
Date: 2025-11-13 Author: Henry Casey Categories: BUSINESS
The U.S. Securities and Exchange Commission (SEC) has proposed revising its approach to defining the status of cryptoassets. According to Commissioner Paul Atkins, the new classification will be based on the principle of dynamic assessment: an asset initially considered an investment contract may cease to be so over time if it achieves a sufficient level of decentralization.
Atkins emphasized that the SEC's goal is to create transparent and unambiguous rules that will help both regulators and market participants understand when a digital asset can be considered a security. To this end, the agency proposed dividing cryptoassets into three main categories.
The first category includes assets that meet the Howey test and are considered investment contracts. These include projects where investors expect returns dependent on the actions of third parties.
The second group will include assets that do not meet the test conditions but require additional legal assessment. These tokens may possess characteristics of both securities and commodities, and will therefore be assessed individually.
The third category is intended for fully decentralized cryptoassets, which the SEC classifies as commodities. Atkins cited Bitcoin as the most well-known example of such an asset, emphasizing its independence from any central authority or developers.
When assessing the degree of decentralization, the regulator will consider four key parameters: the distribution of voting rights, the degree of community participation in software development, the consensus mechanism used, and the absence of a single controlling entity. According to Atkins, these criteria will allow an objective determination of the extent to which an asset truly complies with the principles of decentralization.
Previously, the SEC head noted that the agency intends to change its approach to interacting with cryptocurrency companies. In the future, the regulator will provide projects with advance notice of any violations identified, giving them the opportunity to resolve them before imposing penalties. Atkins emphasized that the new strategy is aimed at increasing transparency and trust between the regulator and market participants.
Thus, the SEC's updated classification could be a key step toward creating a more flexible and equitable legal framework for the crypto industry in the US, one that can accommodate rapid technological change and the increasing decentralization of digital assets.
