Bitwise Asset Management and the Hyperliquid Policy Center are asking the US Securities and Exchange Commission to revise its proposed crypto framework, seeking clearer rules for token classifications, airdrops and secondary-market trading. Their submissions arrived as the SEC’s public comment period on Regulation Crypto Assets was due to close Tuesday.
The proposals could shape how certain crypto projects raise funds, how tokens are treated under securities law and whether digital assets can continue trading through exchanges and onchain protocols without additional uncertainty. According to Cointelegraph, the SEC will review the submitted comments before deciding whether to revise, adopt or withdraw the proposal.
Bitwise seeks a workable classification standard
In an Oct. 19 comment letter, Bitwise said investment managers need a clear method for deciding whether a crypto asset falls under securities laws. The firm urged the SEC to base that determination on information that is publicly available, so managers can apply a consistent standard when assessing digital assets.
Bitwise also asked the commission to explain when managers may rely on an issuer’s proposed Form TR filing. Under the SEC proposal, that filing would certify that an investment contract connected to a token has ceased to exist. The asset manager additionally sought guidance on how a token should be evaluated when an issuer has not submitted such a filing.
The request focuses on practical compliance questions. A manager assessing a crypto asset would need to know both how the asset is classified and what evidence can support that conclusion. Bitwise’s comments ask the SEC to provide greater certainty on those points rather than leaving the interpretation dependent on unclear or unavailable information.
Hyperliquid challenges the scope of the safe harbor
The Hyperliquid Policy Center separately called for a broader version of the proposed conditional safe harbor for tokens associated with investment contracts. The group argued that the protection could arrive too late in a project’s development, potentially limiting its usefulness to token networks that are already operating or distributing assets.
Hyperliquid also requested clearer treatment of airdrops that reward participation in a network. Airdrops are distributions of tokens to users or participants, and the policy center wants the SEC to explain when such distributions would receive protection under the proposed framework. It also asked for guidance on token buybacks.
Another major concern involved trading after tokens enter the market. The policy center said the proposal does not clearly address whether unregistered intermediaries may facilitate token transactions or whether tokens can trade freely through onchain protocols. It urged the SEC to deal directly with secondary-market transactions, saying that otherwise both centralized exchanges and decentralized trading venues could remain unsure about their regulatory position.
The SEC’s proposed Regulation Crypto Assets would establish exemptions for qualifying crypto fundraising and create the conditional safe harbor for tokens linked to investment contracts. The public comment period was scheduled to close Tuesday. After reviewing the responses, the commission may revise, adopt or withdraw the proposal. No timetable for a final decision has been announced, and any final rule would require a commission vote before it could take effect.
Critics call for the proposal to be withdrawn
Not all comments sought adjustments. Former SEC enforcement official John Reed Stark and Duke University finance scholar Lee Reiners urged the commission to withdraw the proposal in an Oct. 16 letter.
They argued that the SEC lacks the statutory authority for the framework and that it could weaken investor protections. In their view, existing securities laws and the Supreme Court’s Howey test already provide a basis for regulating crypto offerings.
Stark and Reiners specifically objected to the proposed fundraising exemptions, which they said could reduce investor safeguards. They also criticized the safe harbor because issuers could, in their assessment, use self-certification to remove tokens from securities oversight.
The pair further warned that adopting the rules largely in their current form could prompt an immediate legal challenge. They said such a challenge could result in the framework being struck down, adding a legal risk to the SEC’s decision over whether and how to proceed.
Moneyiar market picture
Moneyiar data at 08:39 on Oct. 21, 2026, showed Hyperliquid’s HYPE token at $81.3952830188, up 3.71% over 24 hours but down 0.28% over seven days.
Other assets in the supplied Moneyiar data were mixed:
- REAL (ASSET) was $0.1847972829 at 11:39 on Oct. 20, down 1.92% over 24 hours and up 0.3% over seven days.
- Catizen (CATI) was $0.0638818524 at 11:43 on Oct. 12, down 0.09% over 24 hours and 6.41% over seven days.
- Ark (ARK) was $0.1726978478 at 08:39 on Oct. 21, down 0.01% over 24 hours and 7.7% over seven days.
These market figures describe token-price movements and do not indicate what decision the SEC will make on the proposed rules.
