For most of crypto's history, the question "is this token a security?" had no good answer. You hired a lawyer, they applied the Howey test from a 1946 Supreme Court case about Florida orange groves, and you got back a probability rather than a yes. Projects launched offshore. Exchanges delisted assets after enforcement actions rather than before. The regulatory position was communicated mostly through lawsuits.
That changed in 2026, in two steps. In March the SEC published a 68-page interpretive release, coordinated with the CFTC, that sorts crypto assets into named categories. In August it followed up with a proposed rule that gives issuers an actual on-ramp for raising money. Neither one is a statute, and the market-structure bill that would make this permanent is still stuck. But the shape of US crypto regulation is clearer now than it has been in a decade.
The five buckets
Interpretive Release 33-11412, issued on March 17, 2026, splits crypto assets into five categories: digital commodities, digital collectibles, digital tools, payment stablecoins, and digital securities.
The load-bearing definition is digital commodity. The SEC describes it as an asset whose value comes from the programmatic operation of a functional crypto system plus ordinary supply and demand, rather than from an expectation of profit based on the essential managerial efforts of other people. That last clause is Howey, restated. If a token's price depends on a team shipping a roadmap, it fails. If it depends on a network that already works, it passes.
The release names examples, which is the genuinely new part. Bitcoin, Litecoin, and Dogecoin are listed as digital commodities. Under the SEC's interpretation, digital commodities, collectibles, tools, and stablecoins are generally not securities, so long as they are not the subject of an investment contract.
The wrapper matters more than the token
That last qualifier is where most of the nuance lives, and it is the piece people keep getting wrong.
The SEC's position is not that Bitcoin is permanently exempt and some governance token is permanently a security. The asset itself usually is not the security. The transaction can be. A token sold to early backers with a promise that the founding team will build a market for it is an investment contract, and the securities laws attach to that arrangement. The same token, traded years later on a spot market with no ongoing promises from anyone, may not be.
Which means an asset can move between states. The release explicitly addresses how a non-security crypto asset becomes subject to an investment contract, and how it can stop being subject to one. It also walks through the treatment of airdrops, protocol mining, protocol staking, and wrapping a non-security asset. If you have ever wondered whether staking rewards create a securities problem, that is the document to read.
Regulation Crypto Assets: the funding on-ramp
Classification without a fundraising path is only half useful. On August 18, 2026, the SEC proposed Regulation Crypto Assets, its most substantial crypto rulemaking so far. It builds directly on the March taxonomy and adds two exemptions from Securities Act registration, plus a safe harbor from the definition of an investment contract.
The two tracks:
- Startup exemption — up to $5 million raised over a four-year period.
- Fundraising exemption — up to $75 million per year.
For a small protocol team, the practical difference is enormous. Registering an offering is a six-figure legal exercise before you have a product. A $5 million exemption is the difference between incorporating in Delaware and incorporating in the Cayman Islands.
The proposal is not law yet. It carries a 60-day public comment period from publication in the Federal Register, and proposed SEC rules routinely change between proposal and adoption, sometimes substantially.
What is still unsettled
Everything above is agency interpretation and agency rulemaking. An interpretive release binds the SEC's own enforcement posture; it does not bind a court, and it can be rewritten by a future Commission.
The durable version is the CLARITY Act, the digital asset market structure bill. It would draw a statutory line between SEC and CFTC authority, give the CFTC exclusive jurisdiction over digital commodity spot markets, and put Bitcoin's and Ethereum's classification into the US Code rather than a guidance document. The House passed it in July 2025. A revised version cleared the Senate Banking Committee in May 2026, and a merged 600-plus-page text landed on July 22, 2026. As of late August it has still not reached a Senate floor vote, with September floated as the realistic window.
So the honest summary is this: the classification question has a much better answer than it did a year ago, the fundraising path is drafted but not final, and the statutory foundation underneath all of it is still an open bill. If you are building, the March release is the document that tells you which bucket you are in. If you are watching, the CLARITY Act floor vote is the thing to watch.
Sources: SEC Interpretive Release coverage (Orrick), SEC statement on Regulation Crypto Assets, Latham US Crypto Policy Tracker.