A newly released document by the U.S. Securities and Exchange Commission (SEC) reveals that representatives from Chia Network (XCH) recently met with the SEC’s Crypto Task Force to discuss critical regulatory issues facing the cryptocurrency industry.
The meeting, attended by Chia Network CEO Gene Hoffman, Chief Legal Officer Thomas Chow, and Career Capital CEO Trent Martensen, was held on February 25, 2025. Discussions focused on regulatory frameworks for crypto assets, fraud prevention, decentralization, and compliance pathways for blockchain projects.
According to the SEC memorandum, the agenda included:
- Regulation of innovative financial products: Chia Network raised concerns that blockchain-related applications should be treated on their merits rather than rejected because of their relationship to crypto. They cited Permuto Capital’s MSFT Trust I filing as an example.
- Decentralization standards: Chia noted the need for clear guidelines on decentralization, arguing that technical decentralization should be a key determinant in regulatory decisions. They suggested a public notification and comment period for blockchain projects that claim decentralization.
- Token registration and pathways for ICOs: Chia proposed updates to Regulation A to accommodate crypto assets, including provisions on decentralization criteria. They proposed a structured transition period for projects to decentralize while remaining compliant with securities regulations.
- Opposition to regulatory sandboxes: Chia argued that allowing projects to bypass established regulations could lead to systemic risks and encourage hasty token launches.
- Backward compliance relaxation: Chia proposed a framework for non-compliant projects to gain regulatory approval, while also suggesting fair treatment for those who have adhered to regulations from the start.
- More engagement with technical experts: The firm suggested that the SEC consult blockchain academics and industry experts rather than relying solely on project founders.
The meeting highlights Chia Network’s commitment to working within regulatory frameworks, particularly through the S-1 filing process for a potential IPO. The company has positioned itself as a compliance-focused blockchain firm, unlike many crypto projects that face SEC scrutiny for unregistered securities offerings.
The XCH price has gained approximately 11% in the last 24 hours.
*This is not investment advice.
