Overview
- SEC trading-and-markets staff, in a Monday statement, said it will not recommend enforcement against “Covered User Interface” providers that meet strict conditions and it invited public comment before the five-year window expires.
- To qualify, an interface must be strictly non-custodial, let users control their own wallets and signing keys, and avoid taking orders, routing or executing trades, making recommendations, or soliciting specific transactions.
- Fees must be fixed and product-agnostic, providers must disclose conflicts, mechanics, and cybersecurity policies, they cannot take payment for order flow, and any route displays must use objective sorting without “best price” labels.
- Covered tools must connect to decentralized, public smart contracts rather than run internal order books or hidden clearing layers, and providers need written policies to review the venues they surface to users.
- The relief is narrow, applies to crypto asset securities interfaces tied to self-custody, and it ends if a provider holds assets, arranges financing, negotiates terms, or otherwise performs broker functions, with industry figures praising the step as the SEC readies broader “Reg Crypto” proposals and Congress weighs the Clarity Act.