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Resources
Legal Filings & Amicus Briefs
DEF's Amicus Brief in Harper v. IRS (March 2025)​
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Who This Affects: All cryptocurrency users in the USA.
Impact: The government’s actions in Harper v. IRS bring significant privacy concerns to the forefront: Should the IRS be allowed to collect detailed cryptocurrency transaction data, including public blockchain addresses, without a warrant? Does the sweeping collection of such data violate the Fourth Amendment, given the uniquely revealing nature of blockchain technology? These questions challenge the balance between privacy and regulatory enforcement in digital finance.
DEF’s Amicus Argument: DEF argues that the IRS’s data collection practices violate Fourth Amendment rights because blockchain records are far more revealing than traditional financial records. DEF contends that courts must update privacy protections to reflect the extensive and permanent nature of blockchain data, ensuring that individuals' financial information is safeguarded from government overreach.
Result: Ongoing - After a petition for certiorari is filed, the immediate next steps are for the respondent (in this case, the government) to file a response, after which the Supreme Court will circulate the petition for review among the justices. The Court will then decide whether to grant or deny certiorari, a decision that requires agreement of at least four justices.
DEF, BA and TBC v IRS and the Department of Treasury (December 2024)
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users.
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Impact: The finalized "broker" rulemaking by the IRS and Department of Treasury imposes sweeping obligations on software developers and unhosted wallet providers, raising critical questions about the boundaries of regulatory authority. The rule could require developers to collect and report user data they cannot access, potentially stifling innovation and driving blockchain development outside the U.S.
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What Is DEF's Argument: DEF, alongside the Blockchain Association (BA) and Texas Blockchain Council (TBC), argues that the rule exceeds statutory authority, violates the Administrative Procedure Act, and infringes on constitutional protections. They contend that the rule misinterprets the unique nature of decentralized technologies, placing impractical and harmful burdens on the ecosystem.
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Result: Ongoing
Kentucky, Nebraska and 16 Other States & DEF v SEC (November 2024)
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Who This Affects: Cryptocurrency users, protocol developers, and front-end providers.
Impact: Eighteen U.S. states, led by Kentucky Attorney General Russell Coleman, along with the DEF, have filed a lawsuit against the SEC and its Chair, Gary Gensler, alleging unconstitutional overreach in the regulation of digital assets. The plaintiffs argue that the SEC's enforcement actions encroach upon states' rights to develop and enforce their own tailored digital asset regulations, thereby stifling innovation and displacing state laws designed to protect consumers in the digital asset industry.
What Is DEF's Argument: DEF, along with the 18 US States co-plaintiffs, argues that the SEC’s enforcement actions represent an overreach of federal authority, undermining states’ rights to establish tailored regulatory frameworks for digital assets. DEF contends that the SEC’s approach stifles innovation, disrupts the development of state-level protections for consumers, and creates uncertainty in the digital asset ecosystem.
Result: Ongoing
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Please see ​main filing below for explanation.
Amicus Brief re. Davidson v. SEC (August 2024)
Who This Affects: Protocol developers, front-end providers, and cryptocurrency users.
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Impact: The SEC's Consolidated Audit Trail (CAT) mandates comprehensive reporting of securities transactions, raising significant privacy concerns for digital asset market participants. The CAT requires national securities exchanges and broker-dealers to report detailed transaction data, potentially linking personally identifiable information with blockchain wallet addresses. This could expose users' financial activities to unprecedented scrutiny and increase the risk of data breaches.
What Is DEF's Amicus Argument: In August 2024, DEF, alongside the Blockchain Association, filed an amicus brief in Davidson v. SEC, challenging the CAT's extensive data collection. They argue that the CAT's requirements pose severe threats to individual privacy and could deter participation in digital asset markets. DEF advocates for regulatory measures that protect user privacy and support the growth of decentralized finance.
Result: Ongoing
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Please see ​main filing below for explanation.
DEF's Amicus Brief in Support of Roman Storm's Motion to Dismiss the Indictment (April 2024)
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Who This Affects: Protocol Developers, Front Ends Providers, and anyone building or contributing to decentralized protocols.
Impact: The government’s prosecution of Storm raises critical questions for the DeFi community: Can a protocol developer or front-end provider be held criminally liable if a bad actor uses their technology—even without the developer’s knowledge or control? Additionally, can they be charged under Section 1960 as operating an “unlicensed money transmitting business” simply for deploying or maintaining DeFi technology, despite having no direct control over its use? These questions challenge the legal boundaries of accountability in decentralized systems and the applicability of traditional financial regulations to autonomous technologies.
DEF’s Amicus Argument: DEF argues that holding developers or front-end providers criminally liable for third-party misuse of their technology is legally flawed, as smart contracts operate autonomously once deployed. DEF contends that applying money transmitter laws to decentralized technologies misinterprets the law and risks chilling innovation in the DeFi ecosystem.
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Result: Ongoing - As of December 13, 2024, the prosecution of Roman Storm, co-founder of Tornado Cash, is ongoing. Initially, his trial was scheduled for December 2, 2024. However, due to disputes over expert witness disclosures, the trial has been postponed to April 14, 2025.
Beba LLC and DeFi Education Fund v. Securities and Exchange Commission (March 2024)
Who this affects: Cryptocurrency users, protocol developers, and front-end providers.
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Impact: The SEC’s enforcement stance on token airdrops threatens to classify promotional token distributions as securities offerings, subjecting them to burdensome regulations. This could deter innovation and create uncertainty for businesses seeking to leverage blockchain technology for community engagement or marketing. The case challenges whether token airdrops, such as BEBA tokens, can be fairly regulated under existing securities laws without overstepping procedural and statutory limits.
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What Is DEF's Argument: DEF, alongside Beba LLC, argues that the SEC’s approach violates the Administrative Procedure Act by imposing significant regulatory burdens without proper notice or public input. DEF contends that treating token airdrops as securities stifles innovation and creates unnecessary barriers for blockchain businesses, advocating instead for clear and balanced regulatory guidance.
Result: Ongoing​
Amicus Brief re. SEC v. Kraken (February 2024)
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Who This Affects: Cryptocurrency users participating in staking, protocol developers offering staking mechanisms, and front-end providers facilitating staking services.
Impact: The SEC's enforcement action against Kraken has significant implications for the future of crypto staking services in the U.S. By classifying staking programs as securities offerings, the SEC is signaling that similar services must comply with federal securities laws, which could lead to increased regulatory scrutiny and operational changes across the industry.
DEF’s Amicus Argument: DEF argues that applying traditional securities regulations to decentralized staking services is inappropriate and stifles innovation. We contend that staking, as a fundamental blockchain process, should not be subjected to the same regulatory framework as traditional financial securities.
Result: Kraken agreed to cease its staking services for U.S. clients and paid a $30 million settlement without admitting or denying the SEC's allegations.
Scheduling Order in DEF's Fight Against a Patent Troll (January 2024)
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Please see main filing below for explanation.
Order Granting Proceeding in DEF's Fight Against a Patent Troll (January 2024)
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Please see main filing below for explanation.
Amicus Brief re. Van Loon v. Department of Treasury (November 2023)
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See details on the original lawsuit, its impact, and DEF's first amicus below.​
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DEF's Amicus Argument: DEF contended that OFAC’s sanctions improperly extended to domestic transactions, exceeding the agency’s legal authority under the International Emergency Economic Powers Act (IEEPA). DEF highlighted that Tornado Cash’s legitimate uses for financial privacy outweigh its potential misuse, urging the court to overturn the sanctions to protect innovation and privacy rights.​
Amicus Brief re. Harper v. IRS (October 2023)
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Who This Affects: All cryptocurrency users in the USA.
Impact: The government’s actions in Harper v. IRS bring significant privacy concerns to the forefront: Should the IRS be allowed to collect detailed cryptocurrency transaction data, including public blockchain addresses, without a warrant? Does the sweeping collection of such data violate the Fourth Amendment, given the uniquely revealing nature of blockchain technology? These questions challenge the balance between privacy and regulatory enforcement in digital finance.
DEF’s Amicus Argument: DEF argues that the IRS’s data collection practices violate Fourth Amendment rights because blockchain records are far more revealing than traditional financial records. DEF contends that courts must update privacy protections to reflect the extensive and permanent nature of blockchain data, ensuring that individuals' financial information is safeguarded from government overreach.
Result: Ongoing - On May 26, 2023, the U.S. District Court dismissed Harper's claims, and on September 24, 2024, the First Circuit Court of Appeals upheld the dismissal. The court ruled Harper had no reasonable expectation of privacy in his Coinbase records, affirming the IRS's use of a "John Doe" summons. Harper’s next step could be appealing to the Supreme Court.
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Please see main filing below for explanation.
IPR Petition to US Patent & Trademark Office (September 2023)
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Who This Affects: Protocol developers and cryptocurrency users.
Impact: A patent troll targeted DeFi projects like MakerDAO and Compound, claiming ownership over widely used oracle technology and threatening lawsuits against anyone using it without paying licensing fees. This posed a dangerous precedent that could have undermined the open-source nature of blockchain innovation and stifled the development of decentralized finance. DEF’s intervention was pivotal in safeguarding the ecosystem from these legal threats.
What Is DEF's Argument: DEF argued that the patent in question was invalid, as it attempted to monopolize technology that had been widely adopted and developed before the troll’s claim. By filing an inter partes review, DEF demonstrated the patent’s lack of originality, acquired the patent, and dedicated it to the public, ensuring it could no longer be used to harm developers or the ecosystem.
Result: DEF’s acquisition and dedication of the patent to the public eliminated a significant legal risk to the DeFi ecosystem, ensuring that oracle technology remains freely available and innovation in decentralized finance continues unimpeded.
Amicus Brief re. SEC v. Coinbase (August 2023)
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Who This Affects: Cryptocurrency users, protocol developers, and front-end providers.
Impact: The SEC's lawsuit against Coinbase raises pivotal questions about the regulatory classification of digital assets and the applicability of securities laws to cryptocurrency platforms. The outcome of this case could significantly influence the legal framework governing crypto exchanges and the broader digital asset market.
DEF’s Amicus Argument: DEF filed an amicus brief supporting Coinbase's motion for judgment on the pleadings, arguing that the SEC's application of securities laws to digital assets is inappropriate and stifles innovation. DEF contends that the SEC's approach lacks clear guidelines, creating uncertainty for the industry.
Result: The case is ongoing but there was a small win already in the the court dismissed the SEC's allegations regarding Coinbase's Wallet application, ruling that its availability does not constitute acting as an unregistered broker. This is a win for all wallets.
Amicus Brief re. Coin Center v. Janet Yellen (June 2023)
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Who This Affects: Protocol developers, cryptocurrency users, and anyone seeking financial privacy on-chain.
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Impact: The government’s sanctioning of Tornado Cash in Coin Center v. Treasury highlights significant concerns about the limits of regulatory authority over decentralized technologies: Can autonomous, open-source software be sanctioned as if it were a legal entity? Does this undermine financial privacy and innovation by targeting neutral tools essential for decentralized systems? This case challenges the appropriateness of existing regulatory frameworks for emerging technologies.
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DEF’s Amicus Argument: DEF filed an amicus brief arguing that OFAC’s sanctions on Tornado Cash exceed its statutory authority and ignore the autonomous nature of open-source software. DEF contends that sanctioning privacy-preserving tools misapplies the law, sets a dangerous precedent for innovation, and harms users relying on financial privacy.
Result: In August 2023, the U.S. District Court upheld the Treasury's sanctions on Tornado Cash, rejecting arguments that the protocol’s decentralized nature made it exempt from such actions. Coin Center expressed disappointment with the ruling and is appealing the decision.
Amicus Brief re. Joseph Van Loon v. Department of Treasury (April 2023)
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Who This Affects: Protocol developers, cryptocurrency users, and anyone seeking financial privacy on-chain.
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Impact: The government’s sanctions against Tornado Cash in Van Loon v. Treasury pose serious threats to decentralized technologies, raising key issues about how they are regulated: Can autonomous, open-source software be treated as a sanctionable entity? Does this approach jeopardize financial privacy and innovation by criminalizing the use of neutral tools? These actions have sparked a critical debate over the limits of government authority in regulating decentralized systems.
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DEF's Amicus Argument: DEF argued that OFAC’s sanctions on Tornado Cash lack a statutory basis and overextend the agency’s authority. DEF emphasized that sanctioning immutable smart contracts punishes a neutral tool rather than any individual or entity misusing it, creating a dangerous precedent for decentralized technologies.
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Result: The Fifth Circuit Court of Appeals ruled that OFAC exceeded its authority by sanctioning Tornado Cash’s immutable smart contracts, reversing a lower court decision and reaffirming the distinction between decentralized software and entities subject to sanctions. Huge win for DeFi!
Amicus Brief re. CFTC v. Ooki DAO (November 2022)
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See details on the original lawsuit, its impact, and DEF's first amicus below.​
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DEF's Amicus Argument: DEF expanded on their concerns, arguing that treating Ooki DAO as an unincorporated association without clear legal precedent could result in unintended consequences for decentralized governance. DEF emphasized the need for regulatory clarity that appropriately considers the unique characteristics of DAOs, ensuring fair enforcement actions that do not stifle innovation.
Amicus Brief re. CFTC v. Ooki DAO (October 2022)
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Who This Affects: Governance participants, protocol developers, and front-end providers involved in DAOs and decentralized finance platforms.
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Impact: The CFTC's enforcement action against Ooki DAO has significant implications for participants in decentralized autonomous organizations (DAOs), suggesting that individuals who vote on governance proposals could be held personally liable for the DAO's actions. This case challenges the assumption that decentralized structures inherently protect participants from legal responsibility.
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DEF’s Amicus Argument: DEF argued that the CFTC's approach to serving Ooki DAO via a website chat box and forum post was legally inadequate and failed to meet the standards of due process. They contended that this method of service did not provide proper notice to DAO participants, undermining their legal rights and setting a dangerous precedent for enforcing regulations against decentralized entities.
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Result: The U.S. District Court for the Northern District of California granted a default judgment in favor of the CFTC, ordering Ooki DAO to pay a civil monetary penalty and cease operations. This outcome establishes that DAOs can be held liable under existing financial regulations, impacting how decentralized entities operate and are governed.
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Comment & Coalition Letters
DEF Response to CFPB EFTA Proposed Rulemaking (March 2025)
Who This Affects: The entire digital asset industry.
Impact: DEF warns that the Proposed Rule would impose vague and overly broad requirements on the entire digital asset industry—stifling innovation, infringing on First Amendment rights, and creating legal uncertainty—by extending the EFTA without the necessary legal analysis, foundational rulemaking, or legislative authority to do so. Finally, DEF explains that the Proposed Rule is ambiguous as to whether it applies EFTA to software providers (i.e., developers) of self-custody wallets and digital assets, and fundamentally misunderstanding the technology at issue. DEF explains that self-custody setups, in which users control their own private keys, cannot and should not be subject to Regulation E.
Result: Ongoing, the rule has not been finalized.
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users.
Impact: In our comment letter on the IRS’s proposed reporting requirements under the Paperwork Reduction Act, DEF raised concerns that the rules could impose impractical compliance burdens on decentralized technologies by requiring participants to report data they cannot reasonably collect or secure. DEF argued that the proposal’s broad definitions of “broker” and “digital asset middlemen” would place unnecessary burdens on DeFi participants, violate privacy rights, and stifle innovation. DEF urged the IRS to adopt a more tailored approach that respects the unique characteristics of decentralized systems and ensures fair compliance requirements.
Result: In December of 2024, the IRS finalized an unfavorable ruling for DeFi mandating unrealistic reporting requirements. DEF promptly sued over the IRS over this rulemaking, see our lawsuit here.
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users.
Impact: In our comment letter on the Financial Data Transparency Act (FDTA) Joint Data Standards, DEF warned that the proposed standards could impose rigid, one-size-fits-all requirements on blockchain systems, creating significant compliance burdens and stifling innovation. DEF argued that the standards fail to account for the decentralized nature of blockchain technology, potentially forcing developers to collect and report data they cannot access or secure. DEF recommended a more flexible approach that balances transparency and innovation while avoiding unnecessary barriers for decentralized finance and blockchain projects.
Result: No final rule has been made yet.
DEF Response to Comment Request for Digital Asset Proceeds From Broker Transactions (June 2024)
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users.
Impact: DEF’s June 2024 response to the IRS’s comment request on digital asset proceeds from broker transactions highlighted significant flaws in the proposed reporting framework. DEF argued that the broad definitions of “broker” and “digital asset middleman” would create impractical compliance burdens for decentralized finance participants by requiring data collection that is inaccessible in decentralized systems. These rules risk undermining innovation, violating user privacy, and discouraging blockchain development in the U.S.
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Result: In December of 2024, the IRS finalized an unfavorable ruling for DeFi mandating unrealistic reporting requirements. DEF promptly sued over the IRS over this rulemaking, see our lawsuit here.
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Who This Affects: Cryptocurrency users, protocol developers, all privacy tools and users
Impact: DEF’s January 2024 comment letter to FinCEN raises concerns about the agency’s proposed rule on convertible virtual currency (CVC) mixers, arguing that its overbroad definitions could label nearly all crypto transactions as “high risk.” DEF contends that this approach misunderstands the legitimate uses of mixers for financial privacy and imposes disproportionate compliance burdens on the industry. Instead, DEF recommends that FinCEN focus on enforcing existing regulations rather than creating new rules that risk driving innovation offshore and infringing on users’ privacy.
Result: No final rule has been made yet.
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Who This Affects: Protocol developers, front-end providers, and anyone using self hosted wallets.
Impact: DEF’s January 2024 response to the Consumer Financial Protection Bureau (CFPB) raised concerns about its proposal to define "larger participants" in the market for general-use digital consumer payment applications. DEF argued that the proposal’s vague definitions could unintentionally capture self-hosted wallets and small software developers, subjecting them to disproportionate regulatory burdens. These overreaching rules could stifle innovation and discourage the development of decentralized technologies by imposing compliance obligations that do not align with the realities of blockchain systems.
Result: No final rule has been made yet.
Response to IRS on the Proposed "Broker" Rulemaking (November 2023)​
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Who This Affects: All cryptocurrency users in the USA.
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Impact: In its November 2023 comment letter to the IRS, DEF criticized the agency’s proposed broker rulemaking, warning that its overly broad definitions of “broker” and “digital asset middlemen” could impose unworkable compliance burdens on decentralized technologies. DEF argued that requiring participants in DeFi systems to collect and report user data they cannot access or secure risks violating privacy rights and creating undue barriers for innovation. The letter urged the IRS to develop rules that align with the decentralized nature of blockchain systems, protecting both users and developers while ensuring compliance.
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Result: In December of 2024, the IRS finalized an unfavorable ruling for DeFi mandating unrealistic reporting requirements. DEF promptly sued over the IRS over this rulemaking, see our lawsuit here.
Response to Autorite des Marches Financiers (AMF) regarding its DeFi Paper (October 2023)
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Who This Affects: Protocol developers and all cryptocurrency users in France.
Impact: In our comment letter to the Autorité des Marchés Financiers (AMF), DEF critiqued proposed regulations that would impose centralized controls on DeFi, including a government-run certification process for smart contracts and legal liability for developers. DEF argued that these measures would undermine the permissionless and decentralized nature of DeFi, discourage innovation, and violate principles of free expression by targeting open-source code. DEF called for a regulatory approach that recognizes the unique characteristics of decentralized systems and avoids applying outdated frameworks to new technologies.
Result: No final rule has been made yet.
Response to Senate Finance Committee regarding the taxation of digital assets (September 2023)
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Who This Affects: All cryptocurrency users in the USA.
Impact: In its comment letter to the Senate Finance Committee, DEF outlined key recommendations for fair and practical digital asset taxation, emphasizing the need to align tax policy with the unique economic realities of blockchain technologies. DEF argued that staking rewards should only be taxed upon sale, Section 6050I reporting requirements should be revised to avoid privacy violations, and that Congress should modernize tax rules to encourage innovation while reducing unnecessary burdens on cryptocurrency users. These recommendations aim to foster a balanced approach to taxation that supports the growth of the digital asset ecosystem.
Result: No final rule has been made yet.
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Who This Affects: Cryptocurrency users who stake or engage in lending in the UK.
Impact: In our comment letter to HMRC, DEF critiqued the proposed tax framework for DeFi lending and staking, highlighting that it would impose premature tax obligations and fail to reflect the economic realities of decentralized finance. DEF argued that taxing staking rewards upon accrual, rather than at the time of sale, would create undue burdens on users and stifle participation in DeFi. Additionally, DEF emphasized the need for clarity and simplicity in tax rules to ensure compliance while fostering innovation and growth in the DeFi ecosystem.
Result: No final rule has been made yet.
Third Response to SEC’s Proposed "Exchange" Rulemaking (June 2023)
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users of all decentralized platforms.
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Impact: DEF’s June 2023 response criticized the SEC’s attempt to expand the definition of "exchange" under Rule 3b-16, arguing that the agency exceeded its statutory authority and procedural rulemaking requirements. DEF contended that applying centralized regulatory models to decentralized platforms ignores their unique characteristics and creates significant uncertainty for the industry. The letter emphasized that these changes could lead to a de facto ban on DeFi in the U.S., discouraging participation and development.
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Result: The rule has reportedly been discarded.
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Who This Affects: Protocol developers, governance participants, and cryptocurrency users in France.
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Impact: In our comment letter to ACPR (Banque de France), DEF raised concerns about the proposed regulatory measures for decentralized finance (DeFi), which included requiring public blockchains to meet centralized standards, mandating the use of private blockchains for financial functions, and introducing a certification regime for smart contracts. DEF argued that these measures would fundamentally alter the permissionless and decentralized nature of DeFi, discourage innovation, and impose impractical compliance burdens on developers. Instead, DEF advocated for a regulatory approach that acknowledges the unique characteristics of decentralized technologies and avoids forcing traditional financial models onto blockchain systems.
Result: No final rule has been made yet.
Response to U.S. Treasury's Request for Comment on Digital Asset Innovation (August 2022)
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Who This Affects: All cryptocurrency users and developers.
Impact: DEF’s August 2022 response to the U.S. Treasury’s request for comment on digital asset innovation emphasized the transformative potential of DeFi to improve accessibility, efficiency, and transparency in financial systems. DEF argued that regulatory frameworks should nurture this innovation by recognizing the decentralized nature of DeFi protocols and avoiding one-size-fits-all approaches. The letter highlighted the importance of fostering a regulatory environment that protects consumers while allowing the U.S. to remain competitive in the global digital asset economy.​
Result: No final rule has been made yet.
Response to Abu Dhabi Global Market’s DeFi Discussion Paper (June 2022)
Who This Affects: All cryptocurrency users and developers within jurisdictions influenced by Abu Dhabi Global Market’s policies.​
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Impact: DEF’s June 2022 response to Abu Dhabi Global Market’s DeFi Discussion Paper highlighted the societal benefits of decentralization and disintermediation, cautioning against regulatory approaches that reintroduce traditional financial intermediaries into DeFi systems. DEF argued that such measures would undermine the core innovations of DeFi, stifling its potential to create more inclusive and efficient financial systems. The response advocated for regulatory frameworks that preserve the permissionless and open nature of DeFi while ensuring consumer protection.
Result: No final rule has been made yet.
Second Response to SEC’s Proposed "Exchange" Rulemaking (June 2022)
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users of all decentralized platforms.
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Impact: DEF’s June 2022 response focused on the proposal’s failure to adapt to the unique and evolving nature of decentralized finance. The letter argued that the SEC’s static regulatory framework would impose disproportionate burdens on DeFi protocols, harm U.S. competitiveness, and fail to provide consumer protections that align with blockchain’s decentralized structure. DEF emphasized that a one-size-fits-all approach to regulating exchanges undermines innovation and risks misapplying securities laws.
Result: The rule has reportedly been discarded.
Response to SEC's "Dealer" Rulemaking (May 2022)
Who This Affects: Protocol developers and all cryptocurrency who use DEXs.
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Impact: DEF’s May 2022 response to the SEC’s “Dealer” Rulemaking raised concerns that the proposal could unintentionally classify large DeFi market participants and liquidity pools as dealers under securities laws. This overreach would subject these participants to arbitrary enforcement actions and compliance requirements designed for traditional financial intermediaries, creating significant legal uncertainty. DEF argued that the rule’s vague language fails to account for the unique nature of decentralized systems and could harm innovation and liquidity in the DeFi ecosystem.
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Result: In November 2024, the U.S. District Court vacated the SEC's Dealer Rule after a lawsuit by the Blockchain Association and Crypto Freedom Alliance of Texas. The court ruled the SEC exceeded its authority, protecting DeFi participants and liquidity providers from overreach.
First Response to SEC’s Proposed "Exchange" Rulemaking (April 2022)
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Who This Affects: Protocol developers, front-end providers, and cryptocurrency users of all decentralized platforms.
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Impact: DEF’s April 2022 response to the SEC’s proposed Exchange Rulemaking warned that the rule’s overly broad language could unintentionally include DeFi protocols and participants under its scope. By redefining “exchanges” to potentially encompass decentralized platforms, the proposal risked stifling innovation and driving blockchain development offshore. DEF highlighted the lack of clarity in the rule, which failed to address how it would apply to decentralized systems and omitted specific mentions of crypto, DeFi, or digital assets.
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Result: No final rule has been made yet.
DEF Materials
Published in The International Academy of Financial Crime Litigators