The SEC has issued its second no-action letter towards a decentralized physical infrastructure network (DePIN) project, this time to Fuse, the token of the Solana network, thus granting it enforcement protection.

Details:

Fuse’s token, FUSE, is rewarded to contributors maintaining the network. The project, in a letter submitted to the SEC on November 19, sought assurance on compliance with regulatory processes regarding their token offering.

According to Jonathan Ingram, the deputy chief counsel of the SEC’s Division of Corporation Finance, the findings led the SEC to conclude that no enforcement action would be recommended if Fuse adhered to its described operational procedures.

“Based on the facts presented, the Division will not recommend enforcement action to the Commission if Fuse offers and sells the Tokens as outlined in your letter,” said Ingram.

SEC’s no-action letter to Fuse Crypto. Source: SEC

The regulatory body had issued a similar letter to Double Zero a few months earlier. Co-founder Austin Federa noted the contrast between how such letters are frequent in traditional finance but are rare in the crypto sector.

The Shift in SEC’s Approach:

The new leadership under Paul Atkins has led to significant changes in the agency’s stance towards cryptocurrency regulations, fostering a more accommodating environment.

Regarding no-action letters, Rebecca Rettig states these letters offer crypto initiatives much-needed regulatory clarity, which many projects pursue.

Legal professionals, like Bill Hughes, indicate that Fuse’s token would not be classified as a security, emphasizing that its intended use is straightforward and without speculative motives.

The current developments reflect a marked shift in attitudes within the SEC under its recent leadership, paving new paths for cryptocurrency entrepreneurs.