Nazia Saeed
The DeFi Education Fund and the Uniswap Foundation have jointly urged the U.S. Securities and Exchange Commission (SEC) to adopt a hands-off approach when it comes to regulating decentralized autonomous organizations (DAOs), arguing that most DAOs should not fall under the agency’s existing securities framework.
In a letter dated May 27 and addressed to SEC Commissioner Hester Peirce, who heads the agency’s Crypto Task Force, the groups contended that DAOs that are “sufficiently decentralized” should not be evaluated under the traditional Howey test used to determine whether certain assets qualify as securities.
“If a DAO has a dispersed collection of tokenholders who have the opportunity to actively participate in and govern the DAO and the network, it is sufficiently decentralized such that neither the network token for that DAO, nor transactions in which that network token are the object, should be considered a security,” the letter states.
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The letter further argues that such DAOs should be treated legally as individuals or informal groups, not as centralized entities or corporations unless clear evidence suggests otherwise.
The submission was a direct response to Commissioner Peirce’s February 21 public statement, which invited input from industry participants on how crypto assets and decentralized systems should be regulated.
Peirce, widely regarded as crypto-friendly, has long advocated for thoughtful and tailored regulatory frameworks that promote innovation while maintaining investor protections.
The SEC’s posture toward crypto has undergone a notable shift under the Trump administration, particularly following the appointment of Paul Atkins a former crypto lobbyist as head of the agency.
Atkins has signaled strong support for blockchain innovation, asserting that decentralized technologies could create entirely new forms of economic activity. He has also been critical of previous administrations’ more aggressive regulatory approaches.
In a May 20 SEC oversight hearing, Atkins confirmed that the first report from the Crypto Task Force would be published in the coming months. He also announced that the group is organizing a series of roundtable discussions with key stakeholders across the crypto industry.
“We are not here to stifle innovation,” Atkins said during the hearing. “Our goal is to ensure regulatory clarity without shutting down emerging technologies before they’ve had a chance to prove their value.”
