The taxonomy: digital commodities, digital collectibles, digital tools, stablecoins, and digital securities.
The first 3 are categorically NOT securities.
The SEC names 16 digital commodities by ticker: BTC, ETH, SOL, XRP, ADA, AVAX, DOT, LINK, DOGE, SHIB, APT, HBAR, LTC, BCH,…

— Mike Katz (@mikekatz29) March 17, 2026

Footnote 47: "the fact that a non-security crypto asset is subject to an investment contract does not transform the non-security crypto asset itself into a security."
The token is not the security. The transaction is.
The SEC adopted the argument Coinbase and Ripple made in…

— Mike Katz (@mikekatz29) March 17, 2026

Buried bombshell in footnote 7: the SEC quietly reversed a 22-year-old position on the "common enterprise" element of Howey.
Since 2004, the SEC said commonality wasn't strictly required. Now it is.
This narrows Howey most for secondary market transactions. Defense lawyers: file…

— Mike Katz (@mikekatz29) March 17, 2026

Staking, mining, wrapping, airdrops all get safe harbors. But the footnotes contain traps.
FN106: passive mining pool interests? Different analysis. FN123-126: custodian exercises discretion over staking? Outside scope. FN148: announced airdrop during testnet to drive engagement?…

— Mike Katz (@mikekatz29) March 17, 2026

There will be a LOT of commentary and analysis on this in the coming days. Everyone and their Claude will be writing about it.

My initial deep dive with the key footnotes and insights that matter for builders and investors is here: https://t.co/ycUVb1QPHh

Lots more to come as…

— Mike Katz (@mikekatz29) March 17, 2026

Source: Mike Katz

Richard Brown, chief executive and and founding chief technology officer of enterprise blockchain technology provider R3, said in an mail that this taxonomy helps capture what the industry has known for sometime: while a tokenized security is a token, it is also a security.

He said: “Compared to traditional securities, tokenized securities require unique infrastructure, compliance tools, and treatment. However, they are first and foremost an investment contract.

We must recognise when a duck is a duck and take compliance, consumer duty, and market integrity seriously but that doesn’t mean we have to impose the complexity and baggage of legacy market technology onto DeFi. The winners will be the companies that understand regulated financial markets, and build solutions that respect their rules while still retaining composability with the DeFi ecosystem.”

The Tokenization Insight newsletter said the key takeaways are the split of responsibilities between the SEC and CFTC is clearer, the distribution strategy becomes critical for institutions and that wallets, interfaces, and distribution layers gain power:

SEC is responsible for: Investment contracts + Tokenized securities

CFTC looks after: Digital commodities + Derivatives on crypto

Seed stage → security

Mature stage → commodity

This is huge for tokenization as the next evolution of capital market thesis as it creates a clear framework for onchain capital formation with exit options for early investors.”

Mari Tomunen, general counsel at DoubleZero, a purpose-built network that helps blockchains and decentralized systems and apps run more efficiently, said in an email that the industry has been waiting for this clarity as the guidance lays out, in concrete terms, what kinds of promises can be created in an investment contract, and importantly, when that contract ends.

“The tricky part is that this isn’t a one-and-done analysis,” she added. “The legal test is dynamic. The investment contract can fall away as promised milestones are met, but it can also re-emerge if new promises are introduced in connection with new sales of an existing token. That creates tension when those tokens are fungible with ones already in circulation. Over the coming weeks, I’d expect to see a wave of “promises fulfilled” announcements as projects try to reset the analysis.”

Avery Ching, co-founder and chief executive of Aptos Lab, which develops products and applications on the Aptos blockchain, said in an email that he believes this is the starting point for digital assets to serve as a core pillar of the US economy and accelerate real mainstream adoption. 

“The framework they’ve laid out helps resolve the central question of whether the SEC sees secondary market transactions in these assets as potentially implicating U.S. securities laws,” added Ching. “For assets like APT that are explicitly named as digital commodities, that question is now answered, and the downstream effect on what banks, asset managers, and exchanges can offer their clients will be significant and immediate.”

The Securities and Exchange Commission (SEC) issued an interpretation clarifying how the federal securities laws apply to certain crypto assets and transactions involving crypto assets. This is a major step in the Commission’s efforts to provide greater clarity regarding the Commission’s treatment of crypto assets, and complements Congressional endeavors to codify a comprehensive market structure framework into statute. The Commodity Futures Trading Commission (CFTC) joined the interpretation to provide guidance that the CFTC and its staff will administer the Commodity Exchange Act consistent with the Commission’s interpretation.

“After more than a decade of uncertainty, this interpretation will provide market participants with a clear understanding of how the Commission treats crypto assets under federal securities laws. This is what regulatory agencies are supposed to do: draw clear lines in clear terms,” said SEC Chairman Paul S. Atkins. “It also acknowledges what the former administration refused to recognize – that most crypto assets are not themselves securities. And it reflects the reality that investment contracts can come to an end. This effort serves as an important bridge for entrepreneurs and investors as Congress works to advance bipartisan market structure legislation, which I look forward to implementing with Chairman Selig in the near future.”

“For far too long, American builders, innovators, and entrepreneurs have awaited clear guidance on the status of crypto assets under the federal securities and commodity laws,” said CFTC Chairman Michael S. Selig. “With this interpretation, the wait is over. Chairman Atkins and I are committed to fostering a regulatory environment that allows the crypto industry to flourish in the United States with clear and rational rules of the road. The joint agency action reflects a shared commitment to developing workable, harmonized regulations for the new frontier of finance.”

The Commission interpretation:

• Provides a coherent token taxonomy for digital commodities, digital collectibles, digital tools, stablecoins, and digital securities.
• Addresses how a “non-security crypto asset”—which is a crypto asset that itself is not a security—may become subject to, and how it may cease to be subject to, an investment contract.
• Clarifies the application of federal securities laws to airdrops, protocol mining, protocol staking, and the wrapping of a non-security crypto asset.

Market participants—from innovators and issuers to individual investors—should review this interpretation to better understand the regulatory jurisdiction between the SEC and CFTC. The interpretation will be published on SEC.gov and in the Federal Register.

Source: SEC

CFTC Joins SEC to Clarify the Application of Federal Securities Laws to Crypto Assets

The Commodity Futures Trading Commission joined the Securities and Exchange Commission in issuing an interpretation clarifying how the federal securities laws apply to certain crypto assets and transactions involving crypto assets. The CFTC joined the interpretation to provide guidance the CFTC and its staff will administer the Commodity Exchange Act consistent with the SEC’s interpretation. This is a major step in the agencies’ efforts to provide greater clarity regarding the treatment of crypto assets, and complements Congressional endeavors to codify a comprehensive market structure framework into statute. 

“For far too long, American builders, innovators, and entrepreneurs have awaited clear guidance on the status of crypto assets under the federal securities and commodity laws,” said CFTC Chairman Michael S. Selig. “With this interpretation, the wait is over. Chairman Atkins and I are committed to fostering a regulatory environment that allows the crypto industry to flourish in the United States with clear and rational rules of the road. The joint agency action reflects a shared commitment to developing workable, harmonized regulations for the new frontier of finance.”

“After more than a decade of uncertainty, this interpretation will provide market participants with a clear understanding of how the Commission treats crypto assets under federal securities laws. This is what regulatory agencies are supposed to do: draw clear lines in clear terms,” said SEC Chairman Paul S. Atkins. “It also acknowledges what the former administration refused to recognize – that most crypto assets are not themselves securities. And it reflects the reality that investment contracts can come to an end. This effort serves as an important bridge for entrepreneurs and investors as Congress works to advance bipartisan market structure legislation, which I look forward to implementing with Chairman Selig in the near future.” 

The SEC’s interpretation: 

• Provides an interpretation of the definition of “security” as applied to crypto assets and transactions involving crypto assets as part of its efforts to provide greater clarity regarding the Commission’s treatment of crypto assets under the Federal securities laws.
• Provides a coherent token taxonomy for digital commodities, digital collectibles, digital tools, stablecoins, and digital securities. 
• Addresses how a “non-security crypto asset”—which is a crypto asset that itself is not a security—may become subject to, and how it may cease to be subject to, an investment contract. 
• Clarifies the application of federal securities laws to airdrops, protocol mining, protocol staking, and the wrapping of a non-security crypto asset.

The CFTC provides guidance the CFTC and its staff will administer the CEA consistent with the SEC’s interpretation, and that certain non-security crypto assets could meet the definition of “commodity” under the CEA. The interpretation discusses digital commodities in further detail.

Market participants—from innovators and issuers to individual investors—should review this interpretation to better understand the regulatory jurisdiction between the SEC and CFTC. The interpretation will be published on CFTC.gov and in the Federal Register. 

Source: CFTC