Law & Policy

SEC Releases New Crypto Disclosure Guidelines

The SEC’s Division of Corp Finance just dropped clarity on crypto asset securities. Key focus: investor protection via detailed biz descriptions, risk factors, and technical specs. 🧵

general counsel @ 1kx // co-founder @ thing3 // summoner @ hydra ventures

Focus on Business Operations

Issuers must detail things like:
- Development stage & milestones
- Revenue models & crypto asset utility
- Network governance and upgrade processes

This isn’t news for ppl used to registration statements. Keep it specific to the biz, not the broader crypto ecosystem.

Risk Factors: More Than Just “DYOR”

Disclose things like:
- Tech/cybersecurity risks
- Liquidity & price volatility
- Regulatory overlaps (FinCEN, CFTC, etc.)

There’s a plenty of precedent for these out there, most of it shouldn’t be starting from scratch.

Governance & Financials: No Shortcuts

- Disclose execs/policymakers 
- Financial statements must meet SEC standards
- File smart contract code as exhibits (updated for changes)

We’re finally dealing with an SEC that wants to engage. If you have questions, you can finally ask!

SEC’s Crypto Task Force in Action

Acting Chair Uyeda’s team is building a framework, but this guidance is a stopgap. 

It bears repeating, if you have questions you can finally ask and not worry it guarantees a Wells notice. 

Full text:

SEC’s Crypto Task Force in Action

Acting Chair Uyeda’s team is building a framework, but this guidance is a stopgap. 

It bears repeating, if you have questions you can finally ask and not worry it guarantees a Wells notice. 

Full text: https://www.sec.gov/newsroom/speeches-statements/cf-crypto-securities-041025

Technical Specs: Less is Not More

SEC wants:
- Smart contract audit details
- Token supply mechanics (minting/burning)
- Wallet reqs & tx fees
- Tokenholder powers

It’s never been good practice to hide the details. Don’t make it a securities fraud risk.