With an impending potential government shutdown, focus in government was understandably not on crypto regulations or legislation. Even with that, though, the SEC gave a teaser on its expected timeline for the previously announced plan for an “innovation exclusion” from inapplicable securities regulations. Also, there were some developments on payment and internet rails for AI-enabled payments through stablecoins which are worth following.
Here’s everything that happened last week in crypto law:
OTHER STORIES
SEC Innovation Exemption Coming: SEC Chair Atkins has targeted December for when his proposed innovation exemption rules will be published. There is still very little detail other than when it was first announced, but seems apt to allow trading to occur under restrictions which “achieve the core policy aims of the federal securities laws” without pedantically requiring things like books and records of transfers that occur on an immutable and publicly distributed blockchain-enabled ledger. This doesn’t mean the spirit and letter of other securities laws won’t apply, as I expect some DAT participants will learn soon.
Agent Payments/Crypto Rails: About a month ago, I learned that 402 Error for websites was initially planned to be the error code used when it was thought people would need to pay for access to internet sites if the payment failed/there was insufficient balance. So interesting timing that Cloudflare and Coinbase are teaming up to launch the x402 Foundation to drive agent payments. Great explainer here.
Commissioner Peirce Statement: Commissioner Peirce gave a statement titled “Bees, Ts, and NFTs: Remarks at the Coin Center Dinner” which is a must-read if only for its uniqueness. I personally took to heart the ending, though. “I especially appreciate the members of the crypto community who put their noses to the grindstone to serve other people—even when doing so requires them to take career, financial, legal, and reputational risk.” This hit close to home for reasons to be announced soon.
Web3 IP Valuation Article: One of the authors of this piece, Moish Peltz, is a friend and phenomenal attorney for all things crypto. So worth sharing his recent article breaking down some high level issues involved in any crypto IP transfers.
CFTC Leadership Questions Continue: There is still not a confirmed CFTC Chair, and with a looming potential government shutdown this power void is not expected to be filled soon and there are questions even if filled what power that solitary Chair would have without a quorum of bipartisan commissioners. With initiatives like allowing stablecoin collateral for derivatives traders moving forward, eventually this power vacuum will reach a breaking point which is suboptimal.
Vitalik Low Risk DeFi Article: Ethereum co-creator Vitalik Buterin’s most recent article on how low-risk DeFi could be the Google “Search” moment but for Ethereum is something I wholeheartedly agree with and is worth amplifying. At a recent conference, the amounts of times DeFi lending (one person used to buy his car, one for home improvements, another for house downpayment, etc.) was mentioned completely organically was shocking to me. Lending is going to look completely different in 5 years than it looks now.
Prediction Markets Article: This article, Unanswered Questions Surrounding Prediction Markets, is something worth reading for everybody in the space. Kalshi and Polymarket have a combined $17.5 billion of volume in 2025 so far, and haven’t even hit the mainstream yet.
Tokenized Stocks on L2’s: There has been some scuttlebutt the past few weeks on if tokenized stocks can be traded on L2’s without the L2’s themselves being regulated as exchanges. It seems a little silly to me, because L1’s also have MEV/sequencing gamesmanship as does the stock market itself with order routing in HFT. I don’t know if I see any difference between “sequencers” on general-purpose Stage 1/2 L2s and “validators” on L1’s but the discussion is worth pointing out since it is still going on weeks later.
DeFi Education Fund Research: DeFi Education Foundation released some new survey findings worth saving for a rainy day for when people ask about why crypto. Less than half of Americans surveyed believe that the current U.S. financial system meets their financial needs, which seems suboptimal.
Clanker and Rainbow M&A Drama: I saw this first unfolding on Farcaster, but the public discourse around Rainbow’s proposal to acquire token launchpad Clanker is straight out of hostile takeover/ Barbarians at the Gate except in crypto. Which is fascinating to watch and are likely to happen more frequently especially as more projects release governance tokens for decentralization goals.
Aster Dark Pool Perps Platform: Lots of focus the last few weeks on Aster, the perps platform backed by Binance founder CZ, which has the dark pool trading features he has been advocating for. I think this is mostly just the shiny new object after Hyperliquid has dominated the perps market as of late, but I need to try it out just like I try to use all the new shiny objects in crypto so I can intelligently say why they suck or don’t suck.
Visa Bitcoin Rewards Card: Visa is partnering with Stripe and Fold to launch a bitcoin-only rewards credit card on Visa’s network. This comes after Coinbase released their own bitcoin rewards card on American Express.
Liquid Staking Tokens ETF Paper: Loved this paper breaking down how while the characteristics of holding JitoSOL (a liquid staking token for SOL) are technically different than holding SOL itself, for an ETF/ETP, those distinctions shouldn’t matter. Great stuff and a great tweet breakdown here for people that don’t want to read the full 17-page paper.
CONCLUSION
If you have any questions or would like me to write about anything else, let me know on Twitter (X?) or Farcaster. As always, I am an attorney, I am not your attorney. For legal advice, you should always consult (and pay for) an attorney.
Outro/Disclaimer: Since late 2022, I’ve prepared weekly updates for attorneys at my firm to stay abreast of the latest Web3 legal developments. The biggest stories are included in Bi-Weekly posts on the firm’s BitBlog, where we provide tl;dr overviews and insights into the biggest stories from the past two weeks. I post the weekly updates on my personal blog every Tuesday, where I also provide links to more obscure legal developments and otherwise discuss industry trends and stories. Please note, the views and opinions I express, both on BitBlog and my personal blog, are solely my own. They do not reflect the official stance or endorsement of my firm.
The NFTtorney 