Welcome to the Thursday edition of the Crypto In America newsletter!
What you’ll read: A new report on crypto vaults hits the tape this morning as the SEC seeks industry input on the technology. A new survey suggests crypto still has a branding problem among American voters. Plus, former U.S. ambassador to Austria turned crypto entrepreneur Trevor Traina joins the podcast, and we round up the week’s top stories.
As Wall Street increasingly looks onchain to automate lending and investment strategies, a coalition of crypto industry advocates is asking the Securities and Exchange Commission to clarify how decades-old securities laws apply when software takes on the functions of traditional financial intermediaries.
In a 238-page report submitted to the SEC, the crypto trade group Crypto Council for Innovation (CCI) and its members including Bitwise, Galaxy Digital and Morpho argue that the manner in which onchain vaults should be regulated depends largely on how much control humans retain over investors’ assets.
What Are Vaults?
Vaults are blockchain-based smart contracts that accept token deposits and put those funds to work through lending, investment and other financial strategies. First popularized in the DeFi ecosystem, vaults are now attracting interest from traditional financial firms including Apollo Global Management and Société Générale. Earlier this month, S&P Global Ratings also launched a framework to assess the credit risks of onchain lending vaults, though the assessments do not constitute formal credit ratings.
According to S&P, the value of assets deposited in vaults grew more than fivefold over three years, reaching $131 billion in April 2026.
“Calling vaults ‘DeFi’ is like calling databases ‘tech.’ A vault is infrastructure,” Alison Mangiero, chief strategy officer and head of U.S. policy at CCI, told Crypto in America. “Today they are used by crypto-native protocols, but can also power products offered by exchanges, brokerages, and asset managers.”
The Question of Control
The report follows a July statement from then-SEC Commissioner Hester Peirce warning that moving financial activities onchain doesn’t automatically put them beyond securities laws, and inviting industry input on whether existing rules need to change to accommodate vaults.
The report breaks vaults into three broad categories — lending, investment portfolios and more complex trading strategies. The report also proposes a control framework to assess how much discretion human operators have, similar to section 10301 of the Clarity Act’s “decentralized-in-name-only"(DINO) control test. A vault that automatically lends stablecoins according to fixed rules differs from one where an operator can choose investments, change lending terms or redirect funds. Most vaults, CCI says, fall somewhere in between, underscoring the need for clearer regulatory guidance.
The group argues the SEC should take those differences in control into account when determining how to regulate vaults. The more discretion an operator has over investment decisions, the stronger the case for securities-type regulation.
For vaults that fall within the SEC's jurisdiction, the report also proposes ways the SEC could adapt existing regulatory requirements.
The ETF Playbook
For vaults that qualify as investment companies, CCI wants the SEC to follow the same path it took with ETFs, granting exemptions on a case-by-case basis before potentially introducing broader rules. The SEC granted such exemptions for more than 25 years before adopting a dedicated ETF rule in 2019.
The group also wants clarity on when vault operators must register as investment advisers and how custody rules should apply when assets are held and managed through smart contracts rather than traditional intermediaries.
The report recognizes that risk is still present in vaults, and recommends independent audits, mechanisms to pause vaults during security incidents and designated compliance entities where operators retain control. Still, those safeguards offer no guarantee that token holders will recover their assets if a vault is hacked or fails.
It’s unclear whether the SEC will incorporate CCI’s recommendations into future rulemaking or guidance. Peirce’s July statement remains one of the agency’s most direct public discussions of vault regulation, but stopped short of establishing formal standards. Meanwhile, the SEC has moved ahead with other crypto initiatives, including its innovation exemption for tokenized stock trading and proposed rules on crypto offerings and custody.
From U.S. Ambassador to Crypto Entrepreneur: Trevor Traina
This week on the Crypto in America podcast, we sat down with Trevor Traina, founder and CEO of consumer wallet app Kresus and chief business officer at Tools for Humanity. A serial entrepreneur and former U.S. ambassador to Austria, Traina built companies acquired by Microsoft, Intuit and Mastercard before turning his attention to blockchain and digital identity.
In a wide-ranging conversation, Traina shared how he helped persuade President Trump to embrace crypto and bring the industry back onshore at a fundraiser he co-hosted in 2024. He also explained why he’s skeptical of Anthropic’s warnings about AI’s potentially catastrophic effects on humanity, discussed whether stablecoins could strengthen demand for U.S. Treasuries and weighed in on the Clarity Act’s failure, the future of digital identity and why he believes everything will eventually move onchain.
Catch the full episode on all platforms here.
Crypto Still Has a Branding Problem
Americans want financial innovation, but not when it’s called “crypto.”
That’s according to a new survey conducted by Ipsos for the DeFi Education Fund, which found that 35% of Americans consider it very or extremely important for political candidates to support building the next generation of financial technology in the U.S. That figure drops to just 13% when the question explicitly mentions blockchain, crypto and DeFi.
The findings highlight a major disconnect for an industry trying to win over mainstream consumers. They also suggest crypto still has a branding problem, despite support from the Trump administration and growing adoption on Wall Street. The survey comes as more companies move away from branding themselves exclusively around crypto, with a16z crypto’s rebrand to a16z Frontier the latest example.
That disconnect is especially notable given crypto’s original promise. Bitcoin emerged from the 2008 financial crisis as an alternative to traditional financial intermediaries, and the industry has spent years promoting greater individual control over money. Yet while 74% of respondents believe the financial system needs changes to give people more control over their money and assets, just 9% say they’re very or extremely familiar with crypto, and only 5% express high levels of trust in decentralized platforms.
And despite crypto becoming something of a political football in Washington, the survey found little evidence of a partisan divide among Americans. Just 15% of Republicans and 13% of Democrats say it’s important for political candidates to encourage the growth of blockchain, crypto and DeFi. Meanwhile, 27% of both parties say it’s important to support regulations that allow financial innovation.
Beyond public perception, the survey also paints a mixed picture of crypto adoption. The share of Americans who have ever owned crypto rose 4 percentage points, from 18% to 22%, and among those open to trying DeFi, saving and sending money domestically rank ahead of speculation as potential use cases. But the share of Americans who used crypto in the past year remained flat at 13%.
Read the full report here.
News Flash
NYSE Parent Bets on Hyperliquid: ICE is investing in Hyperliquid-based Trade[XYZ] and partnering with the platform to bring 24/7 perpetual futures trading in crypto, stocks, commodities and currencies to the U.S., pending regulatory approval.
Fed Holds Rates Steady as Inflation Woes Persist: The Federal Reserve held interest rates at 3.75%–4%, with two officials favoring a quarter-point increase.
CFTC Eyes the Future of AI-Powered Trading: Chairman Michael Selig convened industry leaders to discuss autonomous trading agents, regulatory oversight and who is liable when AI goes rogue. He also envisioned a future where your refrigerator could buy groceries using money earned from “launching a memecoin or staking ether.”
Wall Street Heavyweights Sign On to DTCC Tokenization Service: DTCC launched a securities tokenization service with 20 participating firms, including JPMorgan, Bank of America, Citi, Morgan Stanley and Fidelity.
More Major Companies Object to OKXICE Share Tokenization: JPMorgan, Coca-Cola, Adobe and Dell are among the latest issuers to object to having their shares tokenized on OKXICE under the SEC’s Innovation Exemption.
Ripple Secures Final OCC Approval for National Trust Bank: Ripple received final approval to operate a national trust bank. Separately, Coinbase added Ripple’s RLUSD stablecoin to its retail and institutional platforms.
Bessent Says Treasury Can Help Fill Clarity Act Gaps: Treasury Secretary Scott Bessent said his department could bring the SEC and CFTC together to advance crypto regulation following the bill’s failure in the Senate.
CFTC Takes Utah to Court Over Prediction Markets: The agency sued Utah in a dispute over whether federally regulated prediction markets are subject to state gambling laws.
Securitize Expands to Stellar: The tokenization platform plans to add Stellar as its 17th supported blockchain, expanding its network options for tokenized real-world assets.
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