SEC Clarifies Rules for Crypto Governance Tokens
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The SEC’s Division of Corporation Finance updated its crypto asset FAQs on November 2, 2026, clarifying how decentralised governance affects the classification of digital commodities under US securities laws.
The update adds Questions 1.4 through 1.6, addressing when governance participants collectively constitute a controlling group, how centralised control over network access is assessed, and why functionality differs from decentralisation.
The clarification builds on the Commission’s March 17 interpretive release but does not itself establish binding rules or new legal obligations.
When Governance Creates Centralised Control
Under Question 1.4, unrelated participants in broad-based governance generally are not treated as a central party unless they coordinate separately from the governance process. Question 1.5 addresses control over network participation, while Question 1.6 distinguishes functionality from decentralisation.
SEC staff emphasise that determining whether governance participants form a controlling group depends on individual facts and circumstances, including operational, economic and voting authority.
The guidance also covers governance arrangements operating through organisations, associations or foundations, including systems where participation depends on holding native tokens.
How Network Control Is Assessed
Question 1.5 identifies unilateral control over access as a significant consideration, including authority to restrict validators, change voting procedures, reverse transactions or modify protocol rules.
Question 1.6 distinguishes a functioning network from one operating without centralised control. A usable token alone therefore does not establish decentralisation.
For governance-token projects, including structures resembling Uniswap’s, the distinction matters because actual decision-making authority, rather than token-based voting alone, determines how the staff’s framework applies.
The SEC states that these FAQs express staff views, not Commission-approved rules. Their application remains dependent on each network’s governance and control arrangements.
