Solana Policy Institute Urges the SEC Carve-Out for DeFi Developers From Exchange Rules
The Solana Policy Institute, a nonprofit that works on blockchain policy, has asked the U.S. Securities and platform Commission to protect decentralized finance innovators from restrictions that treat their work as if it were centralized platforms.
The institute sent a on Friday stating that non-custodial DeFi software is not the identical as fund intermediation. They want the SEC to change its framework to reflect this.
Main Reasons Why the Current Rules Are Wrong
The institute says that applying platform to DeFi developers is a misapplication of rules intended for companies that hold assets and manage transactions. The letter says, “Transactions that happen through a smart contract protocol are not the identical as trading on an platform or ATS and should not be treated as such.”
It asks for that clarify how non-custodial tools differ from brokers and platforms. It also wants modifications to Rule 3b-16 that leave out open-source code from platform definitions. This custody-and-control method would control real intermediaries while giving developers more freedom.
Overregulation’s Risks Are Clear
The institute says that treating DeFi code like centralised platforms might stifle innovation and push activity to unregulated offshore routes, which would hurt the U.S. economy. The has to make “clear, durable lines between software tools and actual intermediaries that exercise custody, discretion, or control over funds or transactions” to stop this from happening.
Developer liability has grown with the convictions of co-founders Roman Storm and Alexey Pertsev for sending money without a licence, even though they didn’t have custody of it.
A largeger Push for Legislation
On Monday, U.S. Senators and Ron Wyden introduced the Blockchain Regulatory Certainty Act. It says that developers who don’t handle customer cash don’t need to comply with money transmitter standards.
Lummis said, “Blockchain developers who have only written code and kept open-source infrastructure have lived in fear of being labelled as money transmitters for far too long.” She wants to make it possible to build digital banking without fear of prosecution.
The has similar protections, but the Senate Agriculture Committee delayed marking it up until late January so both parties could support it. This push for change comes at a time when the SEC is changing, and Commissioner Hester Peirce’s call for comments on December 17, 2025, led to the letter, which could lead to clearer DeFi laws.
