Who really controls a crypto project? Inside the SEC’s new guidance

SEC staff have clarified how shared governance fits into the agency’s crypto framework. The questions reach beyond token votes to the people who can change a network, control access and carry out decisions after a proposal passes. Summary SEC staff added 3 crypto governance answers on November 2. Questions 1.4 to 1.6 address governance groups, participation controls and functionality. The underlying SEC interpretation was issued on March 17 and became effective on March 23. Uniswap’s governance process includes a 7-day vote between a 2-day delay and a 2-day timelock. The CFTC’s 2023 Ooki DAO judgment imposed a $643,542 penalty on the organisation. SEC staff have added 3 answers to their crypto asset guidance explaining how governance participation and control over a network fit into token classification. The SEC’s Division of Corporation Finance updated its FAQ on November 2, adding questions 1.4 to 1.6. The answers distinguish ordinary participation in shared governance from a coordinated group with effective control. Their starting point is that unrelated participants do not generally become a controlling group simply by taking part in a governance system. The same principle can ...