Latest in Blockchain | December 9, 2025
The SEC closed its Ondo investigation and the CFTC opened a pilot program for crypto
Welcome to the Meridian Update. It sure seems like regulators are competing for mentions in the Meridian Update. They aren’t (probably). But it sure seems they are. Let’s dive in.
Time to SEC what’s happening in regulatory
“The SEC has formally closed a confidential Biden-era investigation into Ondo — without any charges.”
We’ve said it before, and we’ll say it again. The US Securities and Exchange Commission (SEC) is an important regulator in US, and frankly global, financial markets. Part and parcel is that the SEC is an important regulator for on-chain assets. Its importance as a regulator for on-chain assets comes in at least two forms:
- What it chooses to regulate. If the SEC thinks it should regulate something, because it finds it to be a security, that thing either needs to follow securities law or go into a court battle with the SEC to reject that it is a security. It’s a burden. There are risks.
- How it operates with respect to the things it has decided to regulate. The SEC can pay attention to something, and write clear rules, or it can leave ambiguity. It can expend more or less effort going after people for suspected violations of various types. It can set forward guidance that, while having no real legal effect, can change how people operate.
People in the onchain world know Ondo as a company that tokenizes assets. Ondo is one of the biggest players in tokenized stock issuance so far. Its efforts, and the broader stock tokenization concept, drew SEC scrutiny. According to Ondo, that scrutiny focused on “whether Ondo’s tokenization of certain real-world assets complied with federal securities laws as well as whether the ONDO token was a security.” So a bit of form 1 and a bit of form 2. But that scrutiny is now over.
Anyway, from Ondo’s chief executive officer (CEO):
“The closure of this inquiry removes an overhang not just for Ondo, but for the entire tokenization ecosystem. It affirms that responsible innovation and U.S. securities laws are in fact compatible, and it signals a meaningful shift toward more constructive engagement. Regulators are reassessing earlier approaches, and the conversation has moved from ‘Should this exist?’ to ‘How do we do this correctly?’”
The “this” there is stock tokenization, and also other forms of onchain finance. And sure enough, this does seem right. Indeed, one of our takeaways from last week’s SEC investor advisory committee meeting panel discussion on stock tokenization was this:
“Generally speaking, there [was] roughly a shared sense [among industry representatives] that tokenized equities are a foregone conclusion, at least as an experiment.”
Generally speaking, there seems to be a roughly shared sense among a lot of people that tokenized equities are a foregone conclusion.
Time to CFTC what’s happening in regulatory
The Commodity Futures Trading Commission (CFTC) can’t let the SEC have all the fun! (This is not true. There is no law requiring the CFTC to not let the SEC have all the fun). Anyway:
“JUST IN: [US] CFTC launches crypto pilot program for tokenized collateral in derivatives markets.”
This is quite interesting. The CFTC is saying, at least for now, people can use certain stablecoins, Bitcoin, and Ether (the native token of Ethereum) as collateral to, say, short something regulated by the CFTC. Notably missing from the list of allowed “digital assets” are SOL (the native token of the Solana network) and XRP (the native token of the XRP Ledger).
This probably isn’t going to change any of our lives tomorrow. How often are we trying to buy cocoa futures and use our Ether as collateral? Oh, every day, actually. Never mind. This is huge news.
We kid. Mostly this frees up big players to comfortably allow customers to use Bitcoin, Ether, or USDC as collateral for options on other onchain assets. As readers of the Meridian Update know, many of these onchain assets are receiving no-action letters from the SEC, making clear their status as commodities.
The most interesting part of the CFTC’s announcement wasn’t what it said, but how it said it. The CFTC might’ve said “This makes sense and so we gave regulatory clarity to that effect.” That isn’t what the CFTC said. The CFTC’s acting director presented this as a way to protect Americans from platforms outside the US:
“Under my leadership this year, the CFTC has led the way forward into America’s Golden Age of Innovation and Crypto. This imperative has never been more important given recent customer losses on non-U.S. crypto exchanges. Americans deserve safe U.S. markets as an alternative to offshore platforms, and that’s why last week I announced that spot crypto can now be traded on CFTC registered exchanges.”
This imperative. Wow. Have fun trading your coffee futures, folks. Have fun. Not financial advice. Do your own research.
That’s a wrap
The SEC closed its Ondo investigation and the CFTC opened a pilot program for crypto. We’ll see you tomorrow morning.
Think we missed something today? Send us a note: email@meridianupdate.com.
