The Hyperliquid Policy Center (HPC) filed a comment letter with the U.S. Securities and Exchange Commission urging adoption of the proposed Regulation Crypto Assets with five recommended refinements.
The SEC's August proposal establishes a federal framework for token offerings and addresses a longstanding gap in crypto asset regulation. Under the proposal, a startup exemption would allow offerings of up to $5 million over four years, while a fundraising exemption would permit up to $75 million in any 12-month period. Tokens issued under these exemptions would avoid state registration requirements.
The proposal also introduces a safe harbor to clarify when a token no longer constitutes an investment contract, with certain resales receiving equivalent state-level relief.
HPC's Five Refinements
HPC's first recommendation concerns airdrops. The group asks the SEC to incorporate its March analysis into the final rule, anchoring it to the "tangible and definable consideration" standard established by prior case law. HPC argues that wallet connections and sanctions screening should not count as payment.
Second, HPC seeks clarity on how onchain protocols may facilitate secondary trading. The group cites the SEC's own economic analysis indicating that benefits "may be fairly small" without a liquid secondary market.
Third, HPC addresses the safe harbor certification process. The group wants language allowing projects to certify that no prior investment contract existed, while maintaining access to the safe harbor as development continues, rather than effectively admitting to a past investment contract.
The final two recommendations target buybacks and preemption. HPC requests that staff guidance on buybacks be added to the rule with a unified definition of "central party." Additionally, HPC asks that federal preemption survive once a project satisfies the safe harbor, preventing tokens from facing registration requirements across multiple state jurisdictions.
HPC stated it will continue engaging with SEC staff as the rule moves toward finalization.
