New submissions filed with the US Securities and Exchange Commission are adding fresh momentum to the debate over crypto self-custody rights and decentralized finance regulation, as lawmakers continue negotiations on federal market structure legislation. The filings reflect growing pressure on regulators to balance innovation, investor protection, and legal clarity amid rapid changes in digital asset markets.
The SEC’s Crypto Task Force recently published two new written inputs addressing critical regulatory questions. One submission, attributed to a Louisiana-based retail advocate, focuses on self-custody protections for individual users, while the other comes from an industry working group examining dealer rules in tokenized and DeFi markets.
The Louisiana-focused submission references state legislation that affirms residents’ right to hold digital assets independently. It argues that upcoming federal legislation should uphold strong registration standards, clear disclosure rules, and robust anti-fraud and anti-manipulation safeguards. The document warns that overly broad exemptions could allow platforms or developers to bypass essential investor protections, increasing exposure to fraud and financial crime.
The industry working group submission urges regulators to clarify that firms trading tokenized equities or DeFi assets solely for their own accounts should not automatically be classified as dealers. It emphasizes that traditional broker-dealer frameworks were designed for centralized markets and may require updates to accommodate smart-contract-based settlement systems.
These submissions arrive as discussions around the proposed federal market structure bill continue. Policymakers and industry leaders are weighing compromises related to DeFi liquidity, stablecoin yield, and consumer protection, with advocates stressing the need for a workable framework that supports both innovation and market integrity.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.