Consensys has asked the U.S. Securities and Exchange Commission to create a formal safe harbor for self-custodial crypto interfaces such as MetaMask, warning that the agency’s latest crypto framework could leave wallet providers stuck between broker-dealer rules and token-by-token legal guesswork.
In a May 11 comment letter to the SEC, Consensys said providers of self-custodial, user-directed interfaces should not be required to register as broker-dealers simply because their software lets users discover, view, or initiate transactions in non-security crypto assets that may still be tied to an investment contract under the SEC’s new “attachment” and “separation” framework.
The letter was filed in response to the SEC’s March interpretive release on the application of federal securities laws to certain crypto assets and crypto transactions. The release, listed under File No. S7-2026-09, became effective on March 23 and uses a framework covering digital commodities, digital collectibles, digital tools, stablecoins, and digital securities.
Consensys praised the SEC for recognizing that most crypto assets are not themselves securities. However, the company challenged the practical effect of the SEC’s position that an investment contract may remain “attached” to secondary-market transactions in a non-security crypto asset until issuer promises are fulfilled or publicly abandoned.
MetaMask developer says wallets cannot police issuer promises
The core of Consensys’ argument is that wallet providers are not in a position to determine whether a token is still legally connected to an investment contract.
The company said that determining whether a non-security crypto asset has become attached to, or separated from, an investment contract depends on issuer-side facts, including statements, distribution circumstances, promotional claims, and whether earlier commitments have been fulfilled. These facts may appear across white papers, blogs, social media posts, governance forums, podcasts, conference remarks, and community updates.
Consensys argued that interface providers generally have no practical way to discover, verify, and continuously monitor those facts across thousands of assets. As a result, the company said an interface provider often cannot know whether a user transaction involving a non-security crypto asset is actually being treated as a securities transaction.
The company also said the legal framework remains unsettled. Its letter noted that no court has yet interpreted the SEC’s “attachment” and “separation” concepts, while crypto securities cases involving Ripple, Terraform, Binance, and Coinbase have produced mixed approaches to secondary-market transactions.
Consensys warns U.S. wallets could be forced into whitelists
Consensys said the SEC’s current framework could leave wallet providers with two unworkable choices.
The first would be to apply the SEC staff’s neutral-interface conditions across all activity involving non-security crypto assets, even where the provider is not trying to facilitate tokenized securities transactions. The second would be to restrict interoperability only to assets the provider can confidently classify as outside the attachment framework, effectively creating a whitelist of approved tokens.
That second approach, Consensys argued, would conflict with how wallet interfaces have operated historically as open discovery tools for blockchain assets. It said such pressure could push U.S.-based interfaces away from open architecture and toward gatekeeping functions that software developers are not built to perform.
The company also warned that offshore wallet interfaces would not face the same limits, allowing them to offer broader token access and more features than U.S. competitors. Consensys said users could migrate to those foreign platforms over time because switching wallets carries little or no cost.
What Consensys wants from the SEC
Consensys asked the SEC to adopt a Commission-level safe harbor confirming that self-custodial, user-directed interfaces do not need to register as broker-dealers solely because they make non-security crypto assets discoverable, viewable, or available for user-initiated transactions.
The proposed safe harbor would apply only if the interface remains noncustodial, does not act as a counterparty, does not match user orders, does not exercise discretionary routing, and ensures that each transaction is initiated and signed by the user.
Consensys also proposed conditions around issuer compensation, asset distributions, enforcement knowledge, and disclosures. Under the proposal, an interface provider would not make false claims about whether an asset is subject to an investment contract and would disclose that it is not a registered broker-dealer, does not custody assets, does not act as counterparty, and does not perform asset-status determinations.
The company said the safe harbor should not override other legal regimes, including the Commodity Exchange Act, the Bank Secrecy Act, or future digital asset market-structure legislation passed by Congress.
SEC staff relief left a gap, Consensys says
The request comes after the SEC Division of Trading and Markets issued an April staff statement on broker-dealer registration for certain user interfaces used to prepare transactions in crypto asset securities.
That statement said covered interfaces may help users convert transaction parameters into blockchain-legible commands for signature and transmission through a self-custodial wallet, while also providing market data such as execution routes, asset prices, and estimated gas fees.
Consensys said that statement was helpful for interfaces involving crypto asset securities, but it left unresolved the treatment of non-security crypto assets that may still have an investment contract attached under the March release. The company wants SEC-level action to bridge that gap before wallet providers are forced to limit token access or treat broad swaths of non-security crypto activity like securities activity.
For Consensys, the issue is no longer whether the SEC recognizes that most crypto assets are not securities. The fight has moved to what happens when a non-security token still carries old issuer promises through secondary markets, and whether wallet software should be expected to police that history every time a user clicks swap.
Also Read: SEC Chair Flags ‘Crypto Vaults’ as Next Regulatory Frontier, Backs CLARITY Act
