Bitwise and Hyperliquid Submit Comments to SEC on Crypto Regulation Amendments

The SEC's proposed regulations could significantly impact the operational landscape for crypto asset managers and token issuers in the U.S.

• On October 19, 2026, Bitwise Asset Management and the Hyperliquid Policy Center submitted comments to the SEC urging revisions to proposed crypto regulations.
• The proposals seek clarity on token classification, airdrops, and secondary trading, aiming to reduce regulatory uncertainty.
• The public comment period closed on October 20, 2026, with no announced timetable for the SEC's final decision.

• The SEC proposed Regulation Crypto Assets in August 2026 to create exemptions for qualifying fundraising activities, including limits on amounts raised.
• The proposed framework aims to address regulatory clarity amid evolving crypto markets and follows earlier SEC guidance on airdrops.
• Industry participants are advocating for clearer standards to foster innovation while ensuring investor protections.

The SEC's proposed Regulation Crypto Assets represents a pivotal moment in the regulatory landscape for cryptocurrencies. The proposed rules aim to establish clearer guidelines for determining whether crypto assets qualify as securities, which has been a contentious issue in the industry. Bitwise Asset Management's submission emphasizes the need for standards based on publicly available information, allowing investment managers to assess compliance more effectively. This is crucial as the lack of clarity has led to significant uncertainty for asset managers and token issuers, potentially stifling innovation and investment in the sector.

The Hyperliquid Policy Center's recommendations further expand on this by advocating for broader safe harbor provisions that would protect earlier-stage projects from immediate regulatory scrutiny. This could encourage more startups to enter the market without the fear of being classified as securities prematurely. Additionally, the call for explicit rules on token buybacks and secondary-market trading is significant. It addresses the growing trend of decentralized finance (DeFi) platforms and the need for regulatory frameworks that can accommodate these innovations without stifling them.

The SEC's review process will be critical in determining the future of these regulations. The agency will consider all submitted comments before deciding whether to revise, adopt, or withdraw the proposed rules. This process is inherently complex, as it must balance the need for regulatory oversight with the desire to foster innovation in a rapidly evolving market. The muted market reactions following the close of the comment period suggest that many are waiting for clearer guidance before making significant moves.

Critics of the proposal, including former SEC officials and academics, have raised concerns about the potential for weakened investor protections and the statutory authority of the SEC to enforce such regulations. This tension highlights the ongoing debate about how best to regulate an industry that is still finding its footing. The outcome of this regulatory process will likely set a precedent for how cryptocurrencies are treated in the U.S. and could influence global compliance frameworks, particularly in regions like Dubai, where the crypto ecosystem is growing.

• Crypto asset managers: They will need to adapt to new compliance standards and may face increased operational costs.
• Token issuers: Startups may find it easier or harder to raise funds depending on the final regulations.
• Investors: Changes in classification could affect the risk profile of their investments in crypto assets.

• SEC's final decision timeline: Understanding when the SEC will announce its decision will be crucial for market participants.
• Market reactions to regulatory clarity: Observing how the market responds to any new rules will indicate investor sentiment and confidence.
• Global regulatory trends: Watch for how U.S. regulations influence other jurisdictions, particularly in crypto-friendly regions like Dubai.