SEC Issues No-Action Letter and Declares DePIN Tokens Outside Jurisdiction

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The US Securities and Exchange Commission (SEC) has indicated it will not regulate DePIN (decentralized physical infrastructure network) tokens, saying “Congress created the Securities and Exchange Commission to oversee the securities markets, not to regulate all economic activity.”

The SEC’s Division of Corporation Finance, led by chief counsel Michael Seaman, issued a no-action letter stating that it “will not recommend enforcement action” against the 2Z token launch by the DePIN project DoubleZero. The letter affirms that the 2Z token—intended as a reward for network participants who contribute physical infrastructure like private fiber links—does not require registration as a class of equity securities.

SEC Commissioner Hester Peirce reinforced this stance, stating that “the economic reality of DePIN projects differs fundamentally from the capital-raising transactions Congress charged this Commission with regulating.” She argued such tokens function as “incentives designed to encourage infrastructure buildout,” rather than investment contracts promising profit derived from others’ efforts. 

Commissioner Peirce warned that treating DePIN tokens as securities “would suppress the growth of networks of distributed providers of services.”

The SEC’s rare no-action letter over a novel crypto infrastructure model hints at a softer regulatory approach toward emerging crypto networks.