The DeFi Education Fund and Andreessen Horowitz proposed a safe harbor for certain applications as the U.S. Securities and Exchange Commission pivots toward a new approach to regulating digital assets.
In a letter sent on Wednesday to SEC Commissioner Hester Peirce, the venture capital firm and DeFi advocacy group called for a safe harbor that could clarify broker rules for blockchain apps, such as Uniswap, Coinbase Wallet, and OpenSea, among others.
“A safe harbor would provide much-needed regulatory clarity, preserve the Commission’s authority to oversee high-risk activities, and ensure that developers can build in the United States without fear of the misapplication of legal categories inappropriate for modern software infrastructure,” they said in the letter.
The call for reform comes amid a noticeable regulatory shift under the Trump administration.
Over the past year, the agency created a new crypto task force to “set the SEC on a sensible regulatory path,” dropped investigations into several crypto firms, and debuted a new initiative called “Project Crypto” to update its rules around digital assets. At the top, Trump has repeatedly vowed to make the U.S. the “crypto capital.”
Under the previous administration, the SEC took specific enforcement actions, which signalled that the agency insinuated that those apps needed to be registered as brokers, the DeFi Education Fund and a16z said. The SEC had alleged that Coinbase Wallet functioned as a broker and was unregistered, but a court later dismissed that claim. The agency had also previously sent notices to both Uniswap Labs and OpenSea that they were under investigation, but those were later dropped.
For apps to qualify for the proposed safe harbor and be excluded from the agency’s broker-dealer regulatory regime, they need to be non-custodial, not make recommendations or exercise discretion, and they say underlying protocols need to be decentralized.
“These conditions are grounded in the understanding that most Apps are fundamentally non-custodial, passive software tools that allow users to interact directly with public, decentralized network and protocol infrastructure,” they said in the letter.
Amanda Tuminelli, executive director at the DeFi Education Fund, said the safe harbor is intended to be flexible.
“Developers deserve clarity, and our hope in submitting this proposal is to provide front end developers with guidelines enabling them to build without fear of being scoped into unreasonable requirements that are misaligned with the realities of the technology,” Tuminelli said in a statement.
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