Bitwise Asset Management and the Hyperliquid Policy Center have asked the US Securities and Exchange Commission (SEC) to make its proposed crypto rules clearer. They want better guidance on how crypto tokens should be classified, how airdrops should be treated, and how tokens can be traded in the market.
Their requests came in letters sent to the SEC before the public comment period closed on Tuesday. The SEC’s proposed rules aim to make it easier for some crypto projects to raise funds and provide limited protection from securities rules for certain tokens.
Bitwise said investment managers need clear rules to decide whether a crypto token comes under securities laws. It wants them to use information that is publicly available to make these decisions. The company also asked the SEC to explain how managers should treat tokens when an issuer files a special form called Form TR. This form would confirm that an investment contract linked to a token has ended. Bitwise also wants guidance on how to assess tokens when no such form has been filed.
Hyperliquid Policy Center Urges SEC to Refine Crypto Rules on Airdrops and Secondary Trading
Hyperliquid Policy Center submitted comments on the SEC’s proposed Regulation Crypto Assets, calling for clearer treatment of free token airdrops, broader secondary trading for exempt tokens, expanded safe harbors and clearer rules for token buybacks. The SEC proposal includes exemptions for startup token offerings of up to $5 million over four years and qualifying fundraising of up to $75 million in any 12-month period.
— Wu Blockchain (@WuBlockchain) October 19, 2026
The Hyperliquid Policy Center has asked the SEC to make its proposed safe harbor wider. A safe harbor is a rule that protects people or companies from certain legal risks if they meet specific conditions. The group believes the proposed protection could come too late for some crypto projects. It also wants clearer rules for airdrops, in which tokens are given to users, including those who help a network grow. The group has also asked for guidance on token buybacks, where a project buys back its own tokens.
Hyperliquid also raised concerns about token trading. It said the proposal does not clearly explain whether unregistered intermediaries can help people trade tokens or whether tokens can be traded freely through blockchain-based platforms. The group wants the SEC to address these issues directly so that crypto exchanges and decentralized trading platforms know what rules they must follow.
However, not everyone supports the SEC’s proposal. Former SEC enforcement official John Reed Stark and Duke University finance scholar Lee Reiners have asked the commission to withdraw it completely. In a letter dated October 16, they argued that the SEC may not have the legal authority to introduce these rules. They also warned that the proposal could weaken investor protection by making it easier for crypto projects to avoid securities laws through self-certification.
Stark and Reiners believe existing securities laws and the Supreme Court’s Howey test already provide a way to decide whether crypto offerings should be regulated as securities. They also warned that the proposed rules could face an immediate legal challenge if adopted in their current form.
The SEC will now review the comments before deciding whether to change, approve, or withdraw the proposal. It has not announced when it will make a final decision. Any final rules will need a vote by the commission before they can take effect.
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