2 weeks ago
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Key Takeaways
- Whether a crypto vault is a security depends on its structure, not its blockchain label.
- Active curator control can trigger securities, fund or adviser obligations.
- A vault that holds securities may fall under the Investment Company Act.
- Peirce invited industry feedback rather than announcing a new rule.
Putting a yield strategy inside a smart contract does not automatically move it beyond the reach of US securities law.
That is the central warning from SEC Commissioner Hester Peirce, also known as “Crypto Mom”, who said crypto vaults and onchain lending products must be judged by how they actually operate, not simply by the technology used to deliver them.
A vault controlled entirely by fixed code may raise different questions from one in which a curator actively chooses where users’ assets are deployed. A lending market with predetermined terms may also look different from a product where a team continually adjusts interest rates, collateral limits and liquidation thresholds.
The important question is therefore no...
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