SEC Clarifies Crypto Compliance Rules: What Is Compliant and What Is Not

• TuongVy Le, a partner and head of regulatory and policy at investment firm Bain Capital, believes that the US Securities and Exchange Commission (SEC) needs to make its crypto compliance rules clearer.
• The SEC recently reached a $30 million settlement with Kraken and issued a Wells Notice to Paxos.
• Le believes that blindly applying existing securities laws could potentially kill something like staking.

SEC Needs To Make Crypto Compliance Rules Clearer

The U.S. Securities and Exchange Commission (SEC) is falling short when it comes to addressing how it deals with the digital asset industry, said TuongVy Le, partner and head of regulatory and policy at investment firm Bain Capital. According to Le, the federal agency is regulating “almost entirely through enforcement actions,” leaving many unanswered questions about what would be considered compliant behavior in the space.

Kraken Settlement And Wells Notice

Le’s comments come in light of the SEC’s recent settlement with Kraken under which the centralized exchange will shutter its staking service platform to U.S. customers as well as its issuance of a Wells Notice to Paxos over potential violations of securities laws related to crypto-asset activities.

Blindly Applying Existing Laws Could Kill Staking

When referring specifically to Kraken’s situation, Le noted that “blindly and mechanically applying the existing securities laws…could potentially kill something like staking.” She urged that more clarity from the SEC on this matter would help better inform those operating in this space about what is considered compliant behavior according to the agency’s standards.

Consequences Of Unclear Regulations

By failing to provide this clarity, Le believes that investors may shy away from participating in certain activities due their uncertainty about whether or not they are compliant with regulations set forth by the agency—something she noted could have serious consequences for innovation in this space going forward.


In conclusion, while enforcement actions by regulators can help bring greater clarity into an evolving industry such as crypto assets, there still remains much room for improvement when it comes to making clear expectations around compliance known so that innovators can move forward confidently within these parameters without fear of running afoul of regulators’ standards or expectations.