SEC staff statement sets conditions for DeFi interface broker-dealer registration, with Algorand generally out of scope
The SEC issued a staff statement on April 13 clarifying when DeFi user interfaces, such as mobile apps and wallet extensions, require broker-dealer registration. An interface can avoid registration if it is non-custodial, non-discretionary, and uses a fixed, neutral fee structure. Because ALGO is classified as a digital commodity, Algorand-based DeFi falls generally outside the statement's scope unless it involves interaction with tokenized assets characterized as securities. The statement is effective through April 2031.
The three conditions for exemption are specific: the interface must not hold user funds directly, must not exercise discretion over transactions, and must apply a flat fee rather than a variable or tiered one. Tokenized assets classified as securities on Algorand would still be subject to the relevant registration requirements under the statement.
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