Written by: Marcus Wolter, Elizabeth Bestwick

On April 10, 2025, the SEC’s Division of Corporation Finance issued a much needed public statement outlining how existing disclosure requirements apply to securities offerings involving crypto assets.[1] For companies operating in the digital asset space, especially those seeking to register equity, debt, or token-linked securities, this guidance offers a detailed roadmap for how to meet obligations under federal securities laws during the SEC’s ongoing development of a broader crypto regulatory framework.

Background

The statement draws from the Division’s review of past filings under the Securities and Exchange Act and is intended to help crypto-focused issuers comply with current disclosure rules, particularly those under Regulation S-K. It addresses filings across multiple forms, including Form S-1, Form 10, Form 20-F, and Form 1-A. While it outlines specific expectations around business descriptions, risk factors, security characteristics, and exhibit requirements, it does not modify existing law or create new disclosure items.

Importantly, as SEC Commissioner Hester Peirce emphasized, the statement does not determine whether a crypto asset is a security. Rather, it provides guidance for those companies that either operate in the digital asset space or offer tokens as part of, or subject to, investment contracts.

Tailored Disclosures for Crypto Businesses

The SEC urges crypto issuers to present clear, concise, and tailored disclosures that reflect their actual operations. Companies should avoid vague or technical explanations that do not meaningfully connect the crypto asset to the issuer’s business. Instead, disclosures should cover the current stage of development, use and function of the crypto asset, network or application governance, and the issuer’s plans post-launch. White papers and marketing materials must be consistent with these disclosures.

The SEC also calls for robust risk factor disclosures addressing token volatility, liquidity, custody, regulatory uncertainty, technological dependencies, and cybersecurity. Legal risks, such as whether an issuer might be required to register with FinCEN, state money transmitter regulators, or the CFTC, should also be addressed.

With respect to the securities themselves, the SEC expects companies to describe key features such as voting rights, transferability, supply mechanics, and how smart contract code governs investor rights. Where applicable, smart contracts or network code that memorialize those rights must be filed as exhibits and updated if changed.

Management and Governance Disclosures

Companies must disclose not only directors and executive officers, but also any individuals or entities, such as DAOs, protocol sponsors, or fund managers, who perform policy-making functions. This ensures investors understand who controls or influences the issuer or its network. If a third party is paid to perform such roles that will also need to be disclosed.

Implications for Crypto Market Participants

The Division’s statement offers much-needed clarity for companies preparing to register crypto-related offerings, reinforcing that federal disclosure rules apply fully in the digital asset space. While it stops short of resolving foundational questions, such as which tokens are securities, it reflects the SEC’s willingness to provide more practical guidance while formal rulemaking progresses.

For crypto issuers, the key takeaway is that boilerplate or overly technical filings won’t meet the mark. Instead, companies must closely link technical design, governance, and economics to their actual business activities and legal obligations. If investor rights are embedded in smart contracts, that code may become part of the public filing, and must be treated accordingly.

As the regulatory environment continues to evolve, this guidance offers an actionable framework for crypto companies navigating SEC registration. If you’re considering a public token launch or evaluating your compliance approach, our team can assist in aligning your disclosures with SEC expectations.

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[1] U.S. Securities and Exchange Commission, Division of Corporation Finance, Statement on Offerings and Registrations of Securities in the Crypto Asset Markets (Apr. 10, 2025), https://www.sec.gov/corpfin/statement-crypto-asset-offerings-registrations-041024.