The U.S. Securities and Exchange Commission has issued new staff guidance indicating that certain user-facing interfaces involved in crypto securities trading may not be required to register as broker-dealers, provided they meet a strict set of conditions designed to limit discretion, influence, and conflicts of interest.
In a statement released by the Division of Trading and Markets of the U.S. Securities and Exchange Commission, the agency outlined a framework under which websites, mobile applications, and browser-based tools that facilitate blockchain-based trading could operate outside traditional broker registration requirements for a limited period.
The guidance applies specifically to “covered user interfaces,” which include software products that help users prepare and transmit crypto asset securities transactions through self-custodial wallets. According to the SEC staff, these tools may qualify for an exemption if they function as neutral interfaces rather than intermediaries that exercise judgment or influence over trading activity.
To remain outside broker-dealer registration, interface providers must adhere to several conditions. These include refraining from recommending specific trades, avoiding solicitation of particular transactions, and ensuring users retain full control over trade parameters such as price, size, and execution preferences. The interfaces must also rely on objective, pre-disclosed criteria when routing trades or displaying execution options.
Back in March, the SEC and CFTC issued joint guidance stating that most digital assets are not securities and introduced a formal token taxonomy that classifies stablecoins, digital commodities, digital tools, and collectibles outside securities law.
The framework left only “digital securities” under traditional regulation while clarifying that activities like staking, mining, and airdrops generally fall outside the Howey Test, marking a departure from prior enforcement-heavy approaches toward a more defined regulatory structure.
The SEC’s disclosure structures
The SEC also emphasized disclosure requirements. Providers must clearly outline fee structures, conflicts of interest, and any relationships with affiliated trading venues or liquidity systems. In cases where a provider connects users to multiple execution pathways, the system must allow users to sort or filter options based on neutral metrics such as price or speed, rather than editorial or promotional ranking.
Another key requirement is operational neutrality. The guidance prohibits interface operators from describing trading routes as “best” or “preferred,” or from providing commentary that could be interpreted as investment advice. The systems must also avoid discretionary decision-making in how market data is presented or how transactions are routed.
The staff statement also places limits on compensation structures. Fees must be fixed, transparent, and unrelated to trade outcomes, execution venues, or counterparty selection. This is intended to reduce incentives for interface providers to favor specific trading environments.
In addition, providers are expected to implement policies for evaluating and monitoring connected trading venues. These policies must assess factors such as liquidity, transparency, security, and reliability, and must be applied consistently across all integrated systems. Any default trading parameters must also be based on objective criteria and subject to ongoing review.
The SEC clarified that the statement is not a formal rule or binding regulation. Instead, it reflects the staff’s current interpretation of how existing broker-dealer laws under the Securities Exchange Act of 1934 may apply to crypto-focused interfaces. The guidance will remain in effect for five years unless replaced or modified through future commission-level rulemaking.
Importantly, the agency stressed that the exemption is narrow in scope. It does not apply to entities that negotiate trades, provide investment advice, custody user funds, execute transactions, or otherwise engage in traditional broker functions. Any platform performing those activities would still fall under existing registration requirements.