The U.S. Securities and Exchange Commission (SEC) is the federal agency that regulates American securities markets. Congress created it in the Securities Exchange Act of 1934, in the wake of the 1929 crash, with three stated aims: protect investors, maintain fair and orderly markets, and facilitate capital formation. It is led by five commissioners appointed by the President and confirmed by the Senate, no more than three of whom may come from one political party.
Why a securities regulator matters in crypto
The SEC's authority attaches to securities, so most US crypto arguments begin with a definition. The test comes from a 1946 Supreme Court case about Florida orange groves, SEC v. W. J. Howey Co.: an arrangement is an investment contract — and therefore a security — where there is an investment of money in a common enterprise with an expectation of profit derived from the efforts of others. Applied to a token, that one sentence decides who supervises it, what must be disclosed, and where it may legally trade.
The agency works in three main modes:
- Rulemaking — proposing and adopting rules under statutes it already administers.
- Review — of registration statements and filings, including the listing standards behind products such as a spot Bitcoin ETF.
- Enforcement — civil actions seeking penalties, disgorgement and injunctions. The SEC brings no criminal charges itself; those are referred to the Department of Justice.
Where it sits next to the CFTC
Derivatives on commodities fall to the Commodity Futures Trading Commission rather than the SEC. Because a token can be argued into either bucket, that boundary has been the central US policy question, and the proposed CLARITY Act was written to assign it explicitly.
How MoonWire uses the term
We report SEC activity descriptively and with dates: a roundtable scheduled while venues listed stock products, in this week in review, and the agency's part in the prediction-market jurisdiction fight, in this regulator tracker. More context sits on the crypto regulation hub.
What it is not
The SEC is not a price regulator and not an endorser. A registration, an accepted filing, or the absence of an action says nothing about whether an asset is worth holding.