The Solana Policy Institute has sent a letter to the U.S. Securities and Exchange Commission (SEC), calling for a clear distinction between centralized exchanges and decentralized, non-custodial DeFi software, and emphasizing that developers should not be treated as intermediaries for regulation.
This move aims to seek regulatory exemptions for open-source DeFi projects, while also preventing technology developers from being burdened with the responsibilities of financial intermediaries.
- The letter to the SEC proposes a clear distinction between centralized platforms and non-custodial DeFi software.
- DeFi developers are advised not to be XEM regulated intermediaries.
- Objective: To grant regulatory exemptions to open-source DeFi , avoiding the obligations of financial intermediaries.
The petition sent to the SEC focuses on the classification of DeFi.
The Solana Policy Institute is urging the SEC to clearly define the difference between centralized trading platforms and decentralized, non-custodial DeFi software.
According to Solid Intel, the letter emphasizes that DeFi software developers should not be treated as intermediaries within the regulatory framework, thereby avoiding being assigned legal responsibilities and obligations as financial service providers.
The proposal aims to protect open-source DeFi projects by promoting regulatory exemptions, while maintaining a clear distinction between centralized platform operations and the development and distribution of decentralized, non-custodial software.
Objective: Exemption for open-source code and reduction of middleman obligation risks.
The central focus of the proposal is to prevent technology developers from having to bear the burden of financial intermediaries.
The letter suggests that regulatory obligations should apply differently between centralized service providers and non-custodial DeFi software, avoiding the perception of programmers or development teams as intermediaries between users and the market.
If XEM from this perspective, open-source DeFi projects could have grounds to seek regulatory exemptions, reducing the risk of being required to comply with obligations typically imposed on intermediary entities in the financial sector.
