Two significant players in the digital asset industry — crypto asset manager Bitwise and decentralized exchange platform Hyperliquid — have independently submitted proposals to the Securities and Exchange Commission (SEC), each calling for substantive rule changes that would bring long-overdue regulatory clarity to token trading and airdrops. The submissions arrived as the SEC's public comment period draws to a close, marking what may be one of the more consequential windows the industry has had to formally shape the rules governing digital asset markets.
The dual filing is notable not just for the prominence of the names involved, but for what it signals about the current state of crypto regulation in the United States. That both a traditional asset management firm with institutional credibility and a decentralized trading platform built on-chain felt compelled to engage the SEC's rulemaking process simultaneously speaks to how acutely the absence of clear regulatory guidance is being felt across very different corners of the industry.
What the Proposals Target
At the core of both submissions is a demand for clarity on how the SEC classifies crypto assets — specifically, the line between securities and non-securities in the context of token issuance and distribution. This question has lingered unresolved for years, producing a regulatory environment where firms must operate under persistent legal ambiguity, often relying on informal guidance, staff letters, or the threat of enforcement action as their only compass.
Secondary-market trading is a second major focus. The current regulatory framework was not designed with decentralized or automated token markets in mind, and the mismatch creates compliance friction for platforms and asset managers alike. Bitwise, which manages a range of crypto-focused investment products, has a direct commercial interest in how tokens traded on secondary markets are classified and what obligations apply to entities that facilitate or hold exposure to that trading activity. Hyperliquid, as a decentralized exchange, faces a structurally different but equally pressing version of the same question.
Airdrops represent the third key area. The treatment of airdropped tokens — distributions made directly to wallet holders, often without any purchase or exchange of value — has long been one of the murkiest corners of crypto tax and securities law. Whether an airdrop constitutes the distribution of a security, a taxable income event, or something else entirely has never been definitively answered at the federal regulatory level in the United States. The fact that both firms flagged this issue in their SEC submissions suggests it is creating enough operational uncertainty to warrant formal resolution.
Why the Comment Window Matters
The timing of these filings is not incidental. Public comment periods are one of the few formal mechanisms through which private industry can influence rulemaking before regulations are finalized. Once the window closes, the SEC is under no obligation to incorporate industry feedback — though it is required to acknowledge substantive comments in any final rule. By submitting now, Bitwise and Hyperliquid are creating a formal record that regulators must at minimum address, even if they ultimately disagree with the proposed direction.
This is a meaningfully different posture from the litigation-first approach that characterized much of the industry's relationship with the SEC in prior years. Rather than waiting for enforcement actions and fighting in court, firms are attempting to participate in the rulemaking process directly. Whether the SEC's current leadership is receptive to that engagement will determine whether this round of comment letters has any lasting regulatory impact.
The Broader Regulatory Landscape
It would be a mistake to read these filings in isolation. They are part of a wider industry effort to push regulators toward a framework that acknowledges the structural realities of decentralized markets — markets where assets change hands on automated protocols, where distributions happen algorithmically, and where the traditional intermediary-centric model of financial regulation maps imperfectly onto actual infrastructure. The European Union's Markets in Crypto-Assets (MiCA) regulation has already established a comprehensive classification framework across the Atlantic, creating competitive pressure on US regulators to offer comparable clarity or risk continued regulatory arbitrage.
Bitwise's participation is particularly significant given its role as a bridge between institutional capital and digital assets. Its product lineup includes exchange-traded funds (ETFs) and index funds that require a stable, predictable regulatory environment to attract and retain institutional investors. Regulatory ambiguity on token classification directly affects its ability to construct and manage those products. Hyperliquid's involvement, meanwhile, illustrates that even natively decentralized platforms are increasingly engaging with formal regulatory processes rather than operating under a posture of regulatory indifference.
What This Means
The submission of these proposals before the SEC's comment deadline closes represents a structural shift in how the crypto industry is approaching regulatory engagement in the United States. Instead of reactive legal defense, leading firms are building a proactive record — one that could inform rulemaking on token classification, secondary-market trading obligations, and airdrop treatment for years to come. Whether the SEC acts meaningfully on this input remains to be seen, but the industry has now formally placed its demands on the table, in writing, at the moment it counts most.
Written by the editorial team — independent journalism powered by Bitcoin News.