Points to Note:

• The U.S. Securities and Exchange Commission has expanded its list of digital assets considered outside its regulatory reach, stating that most stablecoins likely do not qualify as securities.

• However, the scope of this latest clarification appears limited and may exclude Tether, the world’s most widely used stablecoin.

• This stablecoin guidance follows recent SEC statements outlining similar positions on memecoins and crypto mining activities.

The U.S. Securities and Exchange Commission has clarified that it has no regulatory interest in certain stablecoins or their issuers, as stated in the latest guidance from the agency.

Since President Trump’s administration appointed new leadership and established a Crypto Task Force to reduce regulatory pressures on digital assets, the SEC has issued a series of statements to define the boundaries of its jurisdiction. These clarifications have previously addressed areas such as memecoins and proof-of-work crypto mining. The latest statement, issued by the SEC's Division of Corporation Finance, adds specific stablecoins to the list of assets the agency does not consider securities. However, this declaration remains informal and is not yet a binding rule or formal guidance.

The SEC’s statement clarifies: "Individuals involved in the process of 'minting' (creating) and redeeming Covered Stablecoins are not required to register those transactions with the Commission under the Securities Act, nor do they fall within any of the exemptions from registration outlined in the Act."

The statement further clarified that the stablecoins in question—primarily dominated by Tether's USDT and Circle's USDC—are "marketed solely for use in commerce, as a means of making payments, transmitting money, and/or storing value, and not as investments."

However, the stablecoins addressed by this guidance may not apply to Tether’s USDT. One footnote notes that acceptable reserves for stablecoins should not include precious metals or other crypto assets, both of which are part of Tether’s reserves. Additionally, the statement specifies that tokens must be redeemable for dollars at any time, while Tether’s terms of service indicate that minimum amounts or delays could be applied to redemptions.

Circle President Heath Tarbert took to social media to emphasize the SEC’s stance, making a pointed remark toward competitors: 

"The SEC just drew a clear line: Stablecoins backed one-for-one with high-quality liquid assets — like USDC — are NOT securities," Tarbert said. "This certainty does not extend to other digital assets just because they call themselves 'stablecoins.'"

Meanwhile, Congress is advancing efforts to establish clearer standards for stablecoin issuance. This week, the House Financial Services Committee moved a stablecoin bill forward for a vote in the full House of Representatives. In the Senate, a similar bill, which has already passed committee, is also progressing, with both measures receiving broad bipartisan support.

Despite being the most stable of crypto assets, stablecoins have become a hot political topic in recent weeks. The Trump-backed World Liberty Financial has pitched its own stablecoin, while some congressional Democrats are worried that Elon Musk might use his influence as a tech mogul to create a similar offering.

SEC Commissioner Hester Peirce, who is leading the agency's task force on crypto, has expressed that early, nonbinding actions to ease the SEC’s resistance to crypto are crucial and should be executed as quickly as possible, even if they’re not yet official policy. She also mentioned that non-fungible tokens (NFTs) might eventually be considered for similar treatment.

The SEC is preparing for its second crypto summit next week, which will focus on trading.

The agency could soon be led by Paul Atkins, President Trump’s nominee for permanent chairman, if he is confirmed by the Senate. This week, the Senate Banking Committee approved his nomination in a party-line vote.

Even before Atkins' potential arrival, interim Chairman Mark Uyeda has already made significant changes to the SEC’s stance on crypto. These shifts have included dismissing most of the high-profile enforcement cases previously pursued against digital asset businesses, although a few cases remain active.