Aave AppPartner offer
6% variable APY on USDC
Aave App referral code: 7601C1. Sign up with this code to get 6% variable APY on USDC.
Affiliate link. We may earn a commission, at no extra cost to you.
At a glance
- What changed
- A public summary of a legal paper arguing that qualifying DeFi lending protocols and non-custodial vaults are outside US securities laws.
- Who it affects
- Aave users, vault depositors and DeFi builders following US regulation.
- When
- Confidential version submitted on 26 October 2026; public summary released on 3 November 2026. The SEC has not responded publicly.
What was sent to the SEC
Aave Labs, together with Kamino and Veda, has published a public summary of a legal framework for decentralized lending protocols and non-custodial vaults. Aave announced it on its official X account at 14:32 UTC on Tuesday 3 November 2026 (15:32 in Amsterdam), alongside a post on aave.com titled "Making DeFi Lending's Case to the SEC".
According to Aave, the three organisations submitted a more detailed, confidential version on 26 October to the SEC's Crypto Task Force and its Division of Corporation Finance, and asked to meet with staff. The question the paper tries to answer is simple: do US federal securities laws apply when someone supplies an asset to a lending protocol, or borrows against their own collateral? For the protocols the paper describes, its answer is no.
The main arguments
The paper starts with the lending protocol itself, which Aave calls the base layer for vaults, because if that layer were treated as a securities issuer every vault built on it would inherit the same obligations. It argues that there is no lender, no loan and no promise of a return: users keep control of their positions and no company stands between them.
On governance, Aave says token holders listing assets and setting interest-rate and collateral parameters is administration of a market's rulebook, not management of anyone's money, especially because changes only apply after public notice and a timelock. For vaults, it argues users keep ownership of their share of the assets and a curator cannot take or redirect them, although it says a paid curator may still be an investment adviser. It also asks the SEC to classify the transaction rather than any receipt token.
What it does not do
The paper does not ask for a safe harbor, an exemption or special conditions. It says it applies existing law and asks the SEC to confirm it, and admits harder questions remain around actively curated vaults and performance fees. Aave also stresses that the paper does not claim the SEC agrees, and that it is information, not legal advice.
For users nothing changes today: Aave markets and vaults keep working as before. The filing matters because the way the SEC treats lending protocols and vaults could shape which DeFi products can be offered to US users in future. Exchange.news will report any official SEC response.
PhantomPartner offer
10% of trading fees back for 3 months
Phantom referral code: findcodes. Sign up with this code to get 10% of trading fees back for 3 months.
Affiliate link. We may earn a commission, at no extra cost to you.
Conditions
New users who sign up in the Phantom mobile app with this code get 10% of their own eligible trading fees back for three months from signup. Codes apply only at mobile-app signup and cannot be added later. Rebates are paid in CASH to the Phantom Cash balance after a $1 minimum; ID verification may be required. Perps and prediction markets are not available in every region; program terms apply and Phantom may change rates or end the program. Perps are unavailable in the US, UK and US-sanctioned jurisdictions; prediction markets are unavailable in the US, UK, Germany and sanctioned jurisdictions. Program eligibility depends on jurisdiction under the referral terms.
The code and partner link have no expiry. Campaign dates, benefits and eligibility are separate and may change. Check the provider’s current terms before signing up.
