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The U.S. Securities and Exchange Commission (SEC) under the Trump administration stated Monday that proof-of-work (PoW) crypto mining activities do not constitute securities transactions, offering regulatory clarity for a sector long navigating legal gray areas.
Trump-Era SEC Exempts Crypto Mining Activities From Securities Laws in New Guidance
The SEC’s Division of Corporation Finance released a statement on March 20, 2025, asserting that solo and pool-based mining of certain cryptocurrencies—termed “Covered Crypto Assets”—are administrative or ministerial activities rather than investment contracts. This guidance, rooted in the SEC v. W.J. Howey Co. precedent, clarifies that miners who validate transactions or maintain blockchain networks are not subject to federal securities registration requirements.
The statement distinguishes Protocol Mining, including bitcoin ( BTC)-style PoW operations, from securities by applying the Howey Test. Under this framework, the SEC concluded that miners’ profits stem from their own computational efforts—not the managerial work of third parties—making such rewards as “payments for services,” not securities. The analysis applies to solo miners and those in pools, emphasizing that pool operators’ roles remain administrative, not entrepreneurial.
This follows the Trump-era SEC’s January 2025 guidance on meme coins, which similarly narrowed securities definitions by focusing on these types of assets lacking centralized promoter reliance or significant utility. Both actions reflect the administration’s push to tailor crypto regulations to specific use cases, diverging from broader enforcement approaches seen during the Biden years.
The SEC’s latest statement addresses concerns about mining pools, where participants combine computing power to boost rewards. It notes that pool operators’ coordination activities—such as distributing payouts or maintaining software—do not shift profit reliance to third parties, as miners still contribute directly to network validation. The agency also reiterated that Covered Crypto Assets must be “intrinsically linked” to permissionless networks’ operations to qualify under the exemption.
On X, industry advocates welcomed the guidance as a win for clarity, particularly for bitcoin miners and decentralized networks. The SEC’s statement encouraged stakeholders to contact its Office of Chief Counsel for further interpretation, signaling openness to case-specific inquiries. With crypto regulation remaining a contentious political issue, the statement underscores the Trump administration’s focus on fostering innovation through targeted exemptions.