Crypto Task Force Discusses Crypto Regulation with Chia Network and Better Markets

On February 25, 2025, the crypto task force held meetings with representatives from Chia Network Inc. and Better Markets to discuss cryptocurrency regulation and strategies to combat fraud in the crypto space.

Crypto Task Force Meets Industry Experts

🚨NEW: Looks like we’ve got some new entries in the @SECGov #crypto task force meeting log this week:

Notably — perhaps the first crypto “critics” to meet with the task force so far — @BetterMarkets. The group’s Director of Securities Policy Benjamin Schiffrin was in… pic.twitter.com/ymzCzBicTp

— Eleanor Terrett (@EleanorTerrett) February 25, 2025

During the meeting with Chia Network Inc., key participants included Gene Hoffman, President & CEO of Chia Network Inc., Trent Martensen, Co-CEO of Permuto Capital, and Thomas Chow, Chief Legal Officer of Chia Network. The discussion included important concerns such as improving the regulation of crypto assets and the importance of preventing fraud in the industry.

Some of the key points raised during the meeting with Chia Network Inc. included:

1. Decentralization Norms: The industry called for a clear understanding of what constitutes decentralization, emphasizing that decentralized systems carry different risk profiles than centralized technologies. The need for the SEC to define technical decentralization and set standards was highlighted, including the importance of input from blockchain experts.
2. Token Registration and ICOs: The discussion called for an update to Regulation A, addressing the evolving needs of projects that issue their own tokens. It was proposed that successful token registration should be required for crypto asset issuers to sell tokens unless they qualify for an exemption. Furthermore, a transition period was suggested for projects not yet sufficiently decentralized, allowing them time to meet decentralization criteria.
3. Innovative Financial Products: Chia Network representatives emphasized the need for fair SEC treatment of filings related to blockchain technology.
4. Regulatory Sandbox Debate: The Task Force explored the idea of a regulatory sandbox, but Chia Network expressed concerns that such a model could create perverse incentives, encouraging projects to rush token issuance without focusing on building sustainable technology. Instead, Chia advocates for a more structured token registration pathway.

In addition to the discussion with Chia Network, the Crypto Task Force also met with Better Markets, represented by Ben Schiffrin, Director of Securities Policy. The conversation with Better Markets focused on approaches to tackle fraud in the crypto sector and further strengthen the regulation of crypto assets.

As the discussions continue, the Crypto Task Force is expected to incorporate feedback from these meetings into their ongoing work. The Crypto Task Force is also expected to release follow-up materials, including insights from Chia Network’s S-1 filing and decentralization research for more information on the proceedings and future discussions.