SEC Grants Second DePIN No-Action Letter to Solana’s Fuse

The SEC’s no-action letter to Fuse marks the second time in recent months that the regulatory agency has provided formal clearance for a decentralized physical infrastructure network project. This back-to-back regulatory approval, following the similar DoubleZero decision, establishes a meaningful precedent for the entire DePIN sector. The consistent approach suggests the SEC is developing a clearer regulatory framework for projects that utilize tokens primarily for network operations rather than as traditional investment instruments.

The significance of these consecutive no-action letters cannot be overstated for the crypto industry. For years, DePIN projects have operated in a regulatory gray area, uncertain whether their token distribution models would trigger securities law violations. The SEC’s willingness to provide formal regulatory cover to both DoubleZero and now Fuse indicates a growing recognition that certain token-based reward systems serve legitimate operational purposes beyond mere investment speculation. This regulatory clarity could accelerate innovation and investment in the DePIN space, which aims to build decentralized alternatives to traditional infrastructure services.

Fuse’s approach to token distribution proved crucial in securing SEC approval. Unlike many crypto projects that sell tokens to the public through initial offerings, FUSE tokens are exclusively distributed as rewards to individuals who actively maintain and operate the network infrastructure. This utility-focused model, where tokens serve as compensation for services rendered rather than as investment contracts, formed the foundation of Fuse’s successful regulatory argument.

The formal process began on November 19 when Fuse submitted a detailed letter to the SEC’s Division of Corporation Finance specifically requesting confirmation that the agency would not recommend enforcement action against continued FUSE token offerings. This strategic move demonstrated Fuse’s commitment to regulatory compliance and its understanding of the evolving crypto regulatory landscape. The project’s willingness to engage directly with regulators rather than operating in the shadows reflects a maturing industry approach to compliance and governance.

The SEC’s positive response provides what industry observers call ‘regulatory cover’ – essentially a formal assurance that Fuse can continue its current token distribution model without fear of immediate enforcement action. This protection is particularly valuable given the SEC’s historically aggressive stance toward many crypto token offerings, which the agency has frequently classified as unregistered securities.

The consecutive no-action letters for DoubleZero and Fuse establish an important regulatory pattern that other DePIN projects can potentially follow. The SEC’s approval of both projects suggests that token models focused on operational rewards rather than public sales may receive more favorable regulatory treatment. This distinction could help legitimate infrastructure projects differentiate themselves from purely speculative token offerings that have drawn regulatory scrutiny.

For the Solana ecosystem specifically, the Fuse decision represents a significant validation. As a Solana-based DePIN project receiving SEC regulatory clearance, Fuse demonstrates the viability of building compliant decentralized infrastructure on the high-performance blockchain. This could attract more developers and projects to the Solana network, particularly those focused on building real-world infrastructure applications with proper regulatory consideration.

The broader implication for crypto regulation is equally important. The SEC’s willingness to issue these no-action letters indicates a more nuanced approach to crypto regulation than sometimes appears in public statements and enforcement actions. By providing clear guidance through formal channels, the agency is helping establish boundaries that responsible projects can operate within, potentially reducing regulatory uncertainty for the entire industry.