The United States Securities and Exchange Commission (SEC) has signaled a new approach toward certain blockchain projects, specifically those related to Decentralized Physical Infrastructure Networks (DePIN). The agency issued a no-action letter indicating it will not pursue enforcement against a DePIN project, a move that provides greater clarity for developers in this emerging sector of the digital asset industry.
Key Takeaways
- The SEC issued a no-action letter on September 29th, stating it would not recommend enforcement action against the DePIN project DoubleZero and its 2Z token.
- Commissioner Hester Peirce noted that the economic model of DePIN projects differs significantly from traditional capital-raising activities the SEC regulates.
- The decision comes as new crypto projects, such as DeepSnitch AI, continue to attract investor interest in presale rounds, raising over $280,000.
- Market activity for other tokens like ApeX Protocol and Zcash shows significant volatility, with ApeX rising 600% and Zcash gaining 45% in one week.
SEC Provides Regulatory Clarity for DePIN Projects
The U.S. Securities and Exchange Commission has provided a significant update for the cryptocurrency sector by issuing a no-action letter concerning Decentralized Physical Infrastructure Network (DePIN) tokens. The letter, dated September 29th, addresses the upcoming token launch from a project named DoubleZero.
In the communication, Michael Seaman, the chief counsel of the SEC’s Division of Corporation Finance, stated that his office “will not recommend enforcement action” regarding DoubleZero’s 2Z token. This decision is seen by many in the industry as a landmark clarification for projects building real-world infrastructure on blockchain networks.
What Are DePIN Projects?
DePIN stands for Decentralized Physical Infrastructure Networks. These projects use blockchain technology and token incentives to build and maintain real-world physical infrastructure. Examples include decentralized wireless networks, energy grids, cloud storage, and data collection services. The goal is to create more efficient, resilient, and community-owned infrastructure without relying on traditional centralized corporations.
The foundation behind the DoubleZero project explained that its tokens are designed to facilitate access to “underutilized private fiber links” that are managed by various network contributors. The SEC’s response suggests that it recognizes this utility-focused structure as distinct from securities offerings primarily intended for capital formation.
Commissioner Peirce on DePIN's Economic Reality
SEC Commissioner Hester Peirce, often known for her supportive stance on crypto innovation, commented on the agency's decision. She emphasized the unique nature of these projects.
“The economic reality of DePIN projects differs fundamentally from the capital-raising transactions Congress charged this Commission with regulating,” Peirce explained.
Her statement highlights a growing recognition within the regulatory body that not all digital tokens function as investment contracts. This distinction is crucial for the continued development of blockchain projects that have a clear functional purpose beyond speculation.
New Crypto Presales Attract Attention
While regulatory bodies provide new guidance, the market for new crypto projects continues to move forward. One project, DeepSnitch AI, has generated considerable interest during its initial presale phase.
The project has successfully raised over $280,000. Its token price has already seen an increase, moving from an initial $0.0151 to its current price of $0.01701. This represents a 12% gain for early participants.
DeepSnitch AI Presale Details
- Amount Raised: Over $280,000
- Initial Price: $0.0151
- Current Price: $0.01701
- Price Increase: 12%
DeepSnitch AI aims to develop artificial intelligence agents that integrate directly with the Telegram messaging platform. The goal is to provide users with tools like smart contract scans, wallet activity alerts, and trading signals within the application where many crypto discussions already take place. The project also features a staking program that allows users to earn rewards that can be withdrawn at any time without penalty.
Market Updates on ApeX and Zcash
In the broader cryptocurrency market, several established tokens have experienced significant price movements. ApeX Protocol (APEX) has seen a dramatic surge following the announcement of an aggressive token buyback program.
ApeX Protocol Implements Buyback Strategy
ApeX Protocol initiated a $12 million buyback program, committing a substantial portion of its revenue to repurchasing its own tokens from the market. The strategy begins with 50% of daily revenue allocated to buybacks, with a plan to increase this figure to 90% over time.
This mechanism to reduce the circulating supply has had a powerful effect on its market price. According to market data, the ApeX token value increased by nearly 600% over the past week. However, some technical indicators, such as the Relative Strength Index (RSI), suggest the asset may be overbought. Analysts are predicting a potential price correction of around 25% in the near term as the market stabilizes.
Zcash Shows Renewed Momentum
Zcash (ZEC), a privacy-focused cryptocurrency, has also demonstrated strong performance recently. The coin recorded a 45% price increase in the last seven days, signaling renewed investor interest.
Technical analysis indicates bullish momentum, with key moving averages trending upward. Market sentiment surrounding Zcash has turned positive, with the coin experiencing more green trading days than red this month. Based on current trends, some analysts have projected that the price of ZEC could rise by another 35%, potentially reaching a target of approximately $96 by the end of October.