On March 17, 2026, the Securities and Exchange Commission issued an interpretation that provides guidance regarding how the federal securities laws apply to certain crypto assets and to certain transactions involving crypto assets. Consistent with the recent MoU between the agencies, the Commodity Futures Trading Commission joined in this interpretation and guidance confirming that CFTC staff will administer the Commodity Exchange Act consistent with the release. This is separate from, and is not, the anticipated “innovation exemption.” The SEC Chair commented in separate remarks regarding his views on that exemption and other matters on the same day.

This guidance provides a “token taxonomy” for digital commodities, digital collectibles, digital tools, stablecoins and digital securities. Consistent with prior guidance and historic views, it confirms that:

  • Digital commodities are not securities; these are crypto assets intrinsically linked to, and that derive their value from, the programmatic operation of a crypto system that is “functional,” as well as supply and demand dynamics, rather than from the expectation of profits from the managerial efforts of others;
  • Digital collectibles are not securities;
  • Digital tools are not securities;
  • Stablecoins defined in a manner consistent with the GENIUS Act are not securities;
  • Digital securities (or tokenized securities) are securities;
  • Protocol mining and protocol staking do not involve the offer or sale of a security;
  • Wrapping of a non-security crypto asset (in the manner described in the interpretation) does not involve the offer or sale of a security; and
  • “Airdrops” do not involve an “investment of money” as it is understood under the Howey test.

In the guidance, the SEC provides a framework relating to how a “non-security crypto asset” may become subject to, and how it may cease to be subject to, being considered an investment contract.

In a speech on the same day, titled “The Last Chapter in the Book of Howey,” the Director of the SEC’s Division of Corporation Finance states that, “The Commission’s Interpretive Release provides a taxonomy that classifies which crypto assets are not securities versus those that are securities. Beyond that, it gets right to the heart of clarifying when, in the Commission’s view, a crypto asset is subject to an investment contract and, importantly, when it ceases to be subject to an investment contract. A crypto asset that is not itself a security is considered subject to an investment contract when it is accompanied by representations or promises to undertake essential managerial efforts that satisfy the Howey test. The Interpretive Release also provides guidance on the nature of those representations or promises that may help form an investment contract, including the source of the representations or promises, the medium by which they are communicated and their level of detail. The Interpretive Release represents the last chapter in the tale of Howey that brought us the landmark Supreme Court decision clarifying when an opportunity to earn a profit represents the offer of a security. Perhaps this guidance serves as a perfect storybook ending for the “investment contract” made famous by Howey and his orange groves some 80 years ago.” We suspect that since product innovation is never ending, there may be additional chapters to come.

Read the SEC’s fact sheet, the SEC’s press release, the release, published jointly, and the full remarks from the Director of the Division of Corporation Finance.