Federal Policy, Enforcement & Market Structure | Boston Blockchain Week 2026

Thank you everyone. U my name is Megan Spalain. I'm a partner at Guben Proctor in New York. Um but I'm a Quinsey native and I'm very happy to be back here for Boston Blockchain Week. Um as Ian said, we're talking about federal policy enforcement and market structure.

And frankly, I can't imagine a better panel to discuss these issues. I I'm just going to go around the horn and have everyone introduce themselves, not only what you're doing currently, but what you know, legacy experience and and insights you bring to this discussion. Thank you. I was gonna say I could probably like project but mic might be better. Um I'm Kathy Yun.

I am general counsel at Temporal. If you've never heard of us, that's fine. It's meant to be that way. Um very stealth project in the Salana ecosystem where we build core infrastructure in order for the Salana blockchain to work more efficiently. Uh we're also engaged in proprietary trading.

Uh we have one of the top prop amm on Salana called humidify. Um and we have a number of other projects that we're working on. Hopefully I'll be able to announce those soon. Uh but I've been in the space for um I think 10 years in August now. Uh so there's uh been a lot of change in the last decade.

Um I'd like to think that there should have been been more by now. Um but I think we'll we'll go into more of those details later.

Hey y'all. Uh Ron Hammond with uh Wintermute. I'm a head of policy. Uh been we're based out of UK. We're a prop trading firm.

We just actually got a deal license operating United States. So uh we are have an office in New York now. It's grown from three people year ago. Sorry it's a little off here. Um and so uh right now lead all the policy advocacy both US UK uh as well as Mina recently a little more.

Uh before that I worked at the blockchain association which is a trade association based in DC as their lead lobbyists uh for about 100 companies uh plus in the crypto space. So saw during the Gensler era all those war stories. We'll probably go into that a little more. Uh and then before that I used to work in Congress for representative Warren Davidson of Ohio. Uh back in 2016 2017 worked on the very very early first version of what is now known as the Clarity Act.

It was called the token taxomi act. Uh was deciding a lot of these questions that Taylor did a great job explaining earlier. uh you know security, commodity, uh what are some of the implications of that as well as taxes and other uh solutions like custody. So uh been in this space for about 10 years as well. So looking forward to getting on all of it.

Hey

everybody, Troy Pis have my own consulting advisory practice across entirety of financial services, corporate governance and related things. Prior to that I had been a commissioner at the Securities and Exchange Commission. Prior to that, professor of corporate securities law and if we rewind the clock a bit more corporate law.

I'm Dave Crosby. I first crypto university department. I then went off to the predecessor to crypto task force in the days of first ICO Trump administration. I went through uh the Biden administration and then before the Trump administration now I'm working on tokenized equities.

Okay. So I was thinking back to when I sat on this stage last year and uh the Genius Act had just been signed into law. We had all the enforcement actions had been long dismissed and really we were entering 2026 with a lot of hope particularly with regard to the Clarity Act. Um so sitting here today I guess my first question for the group is has 2026 delivered for us on these promises and all of this um all of this optimism that we had? Um and Ron I think I want to start with you.

You gave us a little bit of your inside baseball on the development of the Clarity Act over time. What happened and where do we stand? I mean, we heard the 15% prediction of of it passing, but what was what was the hold up and what is your assessment about about where things stand right now?

Uh, politics, and that's the unfortunate truth. Politics is a funny way of ruining everything. no matter how far along the progress has gone or no how bipartisan the conversation is the second you mention Trump the second you mentioned immigration you know some of these key words you lose one side or the other uh in a heartbeat like that um and so that's the really unfortunate part I mean this has been bipartisan issue I mean since I worked on it back in 2017 we had four Republicans four Democrats lined up and again like this is a bill that was kind of more laying the groundwork for what clarity is now the become I mean it's a huge bill and huge bills don't happen often in Congress so that's the other thing you have to a make sure politics doesn't play a role here and B make sure Congress actually does something. Those two things don't line up very often at all. But we have seen, you know, things move along pretty well.

I mean, the House pass the Clarity Act over twothirds majority. That's very rare. Cong Republicans and Democrats do not agree on much, but to have twothirds of Congress vote in support of something besides renaming of post office is so rare that uh I it's does give me a lot of encouragement. But I knew the second that this kept getting delayed from last year in July when the GSA passed and clarity passed the house to this moment now we are getting too close to the election year politics of course the Trump administration family is now kind of the target here uh as opposition voices and again the the bill has been out for a couple months now. What's going to happen pretty soon is probably next two or three days you're going to see a new version of the Clarity Act.

It might have some ethic provision against the Trump administration or Trump officials or the White House. Um but you're going to have a lot of Democrats say I have not had time to review this. I'm not going to support this bill and unfortunately we're not expecting a a positive vote unfortunately on the 15th next week. However, I am not saying that this bill is dead. I mean, I've sat in the room once when Mark Zuckerberg pitched Libra about a year before it happened to Congress.

And tell me, trust me, it was horrible. It was one of the worst pitches I've ever seen in Congress. Um, and we even had the chair of Republicans saying, "We don't care if you like this or not. No one's allowed to be pro Mark Zuckerberg or pro Libra." Like, and still we have the Genius Act getting signed into law about two, three years later.

So like there is a world where this just gets done maybe in a lame duck or something like that. So that's why I'm personally at about 10% chance right now because politics could go away in November, December, but just more framing that unfortunate the policy can be really well or in some cases not so well, but it's the politics that's going to really ruin it unfortunately.

Okay, so we're not dead yet. And I I hate to keep using this word uncertainty, which I feel like has plagued the panels as I've done them year over year, but I think suffice it to say we're still in a period of some uncertainty. So Kathy, how is that impacting both the project you're working on as well as what you're seeing in the broader ecosystem in terms of actually getting things done?

I think I've gotten really good at working in very muddy waters. Um it's it's pretty much been the only way you've been able to move forward. Uh you could either be paralyzed and tell your clients, tell your projects no all the time, saying that we need to have more clarity. Um or you can find ways using existing frameworks, existing laws, rules, and try to find good faith ways to move forward. Um, in the end, all I can do is be able to look a regulator or someone in the eye and explain um why in good faith we've taken the the measures that we've had uh taken.

But at the same time, it would be nice to have some definitions that the entire industry can agree on. I I don't think we've we as as a space terrible about using throwing terms around that means so many different things. Um even the word stake uh can mean so many different things. If if you ask three different people what the definition is, I think you will get three different definitions. Um so while I am not a huge fan of of clarity, um I do think having some definitions that we can start working with that everyone can start agreeing mean one thing as to a number of different things would help projects be able to move forward also.

Okay. Um, so I really enjoyed Taylor Lynman's remarks about all the work that the SEC is doing and I think you know everyone in this room can say that is a very positive thing and both the SEC and the CFTC have kind of jumped to fill the gap left by this continuing languishing clarity act. Um, so we we heard a little bit about um some of the initiatives like regulation crypto. There was also the the inter guidance that came out in March uh which really set forth a token taxonomy. Um so all these all these things you know are really gap fillers for for trying to give some more clarity or or more things to cling to Kathy I think as you advise clients in on on how they can do things in a in a compliant way.

Uh David I'd like to go over to you. I know that you and and Troy bring slightly different perspectives given your time at the SEC. um how how can can you describe a little bit more for us how the staff versus a commissioner how how do the two relate on these important issues in driving the industry forward

okay so it's unusual on a panel to have an ex commissioner and staff side by side basically the staff works for the commission they give advice and you end up responding to either the enforcement industries requirements. Good example was that when I joined in 2020, uh the first project I got was for the revival of the Boston stock exchange. The idea behind the Boston stock exchange was it was going to be over stock. They were going to have tokenized equity that was going to be on blockchain and this was how they were going to trade. that was had a very very strong push back industry exchanges did not like at all and commission was staff was trying to sides now and at that point they basically gave up a lot of it comes from the direction you're getting

and David do you have an assessment just with all the developments and guidance that the has given over the past year and a half. Do you have an assessment? Is that consistent with your experience or do you view it as an expanded role?

They're the same questions we were looking at 2020. They're exactly the same. Uh the only thing that's changed is a lot more money in the industry. So there's a lot more pressure. Um and the established uh financial industry has switched from trying to block to encourage.

So stock is a good example. The If you go back and you look at all the all the requested comments, the rest of the industry was very very against it. Now the industry is for it. Um and the I felt like I was inside of football being kicked around the field. I came out of academia and suddenly it was full of lawyers and all these pressures from outside.

So uh it's a it's it responds to the regulation responds to how how people feel. You made the comment about Mark Zucker. I worked on the legal case and the political pressure was strongly against the person behind it and that's why they changed their name. But whenever I went and work banking committee, that was the thing that everybody said even though he Troy, I want to turn it over to you just in terms of everything from the court guidance about memecoins and staking to the to the more formal interpretive release in March. Um there's a lot of very exciting developments here, but the question is how how are those actually going to hold up in court and what what's that going to look like?

So could you uh give the audience a little bit of a perspective on how those two things interrelate and what the stakes are there?

Yes. So I'm not going to get into all the different arguments one could make as to why something should be overturned or not overturned. I'm happy to talk about that other times because there's so much detail there that bog us down. But as a general proposition, one of the things to think about it, it goes to something that Taylor was saying that has been kind of a key word throughout the entirety of the administration, not just in the context of crypto, not just as the SEC, but but durability and the different ways in which one can achieve durability. Just a quick footnote to that in a democratic process where you have democratically elected representatives and folks who are appointed to agencies, commissioner levels, confirmed by the senate, nominated by the president, all the rest, there is baked into that structure only so much durability, right?

That is by design. Even something that is done legislatively now may be difficult to get things amended to get things passed and get things amended that at least by way of design and structure it is set up so that things can change over time. So durability I think if the sense of when sense of durability is immutability not no pun intended well it's not going to be immutable you may get more durable as compared to less durable but there's always room for some element of change and adaptation and that can actually be quite constructive over time having that as kind of a bit of a backdrop to to your question as to everything many things that the SEC is doing there's always the question of Is the agency going to be sued? I would say the same thing as to the CFTC. I'd say the same thing if it went through all the other agencies and it was certainly something in consideration at the SEC when I was there.

When I was there and I was dissenting on things, oftentimes the things I was dissenting on ended up being challenged and many times actually ended up being overturned. So that's part of the administrative process. There's nothing unique about this space, unique about the SEC. But given what everybody's been saying, the stakes are extraordinarily high. The agency is taking a lot of different actions.

We'll see what happens now down the road when it comes to clarity. Even in the context of clarity, the agencies have a lot of rule making authority. So it's not as if everything is done just because clarity gets across the finish line. There's still rule making for the agencies to do and with a lot of different interests, a lot of different views, one can expect that in many cases there will be a case, there will be a litigation, there will be a challenge as a general matter. And again, I'll skip past all the uh specifics here.

The nature of challenges when there is a challenge, I'm not saying everything is going to be challenged, but when there is a challenge is basically twofold. One is is that the agency, in this case, the SEC acted in a quote unquote arbitrary and capriccious manner. If you ever hear that phrase, as I'm sure you do, that's a phrase that gets used because it's the phrase that's used in the administrative procedure act, which is the stat which is the statute pursuant to which challenges are brought. The argument is that the agency didn't engage in rigorous enough decision-making process analysis that it's tantamount to having acted in an arbitrary and capriccious manner. And if you act in an arbitrary and capriccious manner, that's basis for the court to overturn the rule.

That's one nature of challenge. The other nature of challenge is that an agency exceeded its agency did not have the authority under its authorizing statutes to do whatever it did. I expect in some instances we will see litigation where both of those theories are advanced. The agency the argument will be acted in arbitrary manner and in any event even if they didn't that they didn't have the authority to do whatever they did. Why is this consequential?

Again we don't know when um which which rulemakings or other actions will in fact a challenge. But that's the general the general contrast. Why does it matter? Well, it matters for a whole host of reasons. One reason that particularly matters is when you start looking at the clock because to go from the filing of a lawsuit through judicial opinion, things go quickly.

Nine months slowly, 15, let's just call it 12 months plus or minus. You can do the math from where we are. And if you go back to what Taylor was saying, a lot of the stuff is in proposing stage, not adopting stage. So it's not until you get to a final rule or in the case of the innovation exemption when whenever that gets advanced and voted on and approved by the commission, assuming they do. So you start adding, okay, well rule adoption, then you add a year, and then if there's an appeal, you start adding more time.

You can do the math in terms of when you start getting up to you potentially start getting into 28 and you may actually get into 29 depending upon when things get finalized, how long litigation takes and what have you. And of course we have something happening in the early part of November 28th. So the clock is an extraordinarily important part of part of this even if rules are upheld. Now the one other nuance I would note and it's a nuance from a litigation perspective but it's quite consequential is the prospect of whether or not there's a state because if there's a if there's a challenge litigation when it comes to something an agency does and the court decides to stay the rule what that means is the rule doesn't go into effect until litigation wound itself wound itself up. If it turns out that there's litigation, no state, then the rule does go does go into effect.

But then there's always the proxy that the rule nonetheless could be overturned in which case the thing you were relying on by way of a rule change or some other agency action gets overturned and where does that lead? So it's an important part of the overall practical pragmatic consideration. We know the policy direction. We know there's a lot of action at the agency right now. Expect that to continue throughout the balance of this calendar year and in the next.

But there are two things that the agencies don't control. One, who sues and what does court do in reaction? And two, there's an election. Both of those.

Fair enough. Yeah, we've talked a lot about the pendulum swinging and you know this ve very favorable regulatory environment perhaps under another administration could look very different. Um so I mean what's what's the solution there? Is the solution a legislative solution as being more durable?

Well, so the thing about a legislative solution is you still have And one of the other just inherent practical challenges is words on the page get litigated over time. I mean if if you think about the federal securities laws outside the context of crypto and tokenization digital assets words on the page going back to 1933 34 and 1940 and 1940 again continue to be litigated. I mean the Supreme Court this term just heard and decided an opinion as to what the DC has to or doesn't have to show in order to get discouragement in enforcement action. Discorggement is not a new concept. Discorggement goes back centuries and we have a Supreme Court US Supreme Court decision kind of continuing to set the contours to jurist prudence around disorgion.

So the point there being that there is a long future whether it's as a result of what the agencies do under the existing statuto framework, what the agencies do under any new statuto framework of I think the the benefits of some legislative approach is this speaks to Kathy what you were getting at is it helps set the contours and the parameters because as a practical matter when you're giving advice or you're running a business like all right I get it fair enough things change sometimes you want things to change expect things to change but you only expect them to change so much if they change within here we're kind of bouncing around like we can manage that markets are you all as business leaders and advisors and counselors are accountable But if the changes could be diametrically opposed, well then we have then we have a practical problem because then you're caught in the middle of the back and forth. So the the the the action the agencies are taking now. We'll see what ends up coming out of of Congress. We'll see what ends up happening on the litigation. I think Kathy just underscore this as a last point used a phrase a couple of times I just want to emphasize the importance of which is good faith.

One of the challenges that's been tricky in the space is a lot of the things that the statutes require and and the and the rules and regulations promulgated under the statutes are strict liability offenses. But if you can nonetheless demonstrate that you have the right folks around the table and you're trying to get it right, even if the agency thinks you got it wrong, boy, you're much better off in that discussion. There's no assurances as to how that discussion ends, but you're much better off in that discussion than if they you really weren't taking seriously the patients.

Okay, that's a great segue uh to the next point. We're going to combine a couple concepts I think in the interest of time. Um, but Kathy, you've been in the space for 10 years. You've advised countless companies on how to do this correctly. Um, so for someone that's, you know, an OG and has been doing things in good faith for years and years, what is your assessment about what all the recent SEC guidance has has provided in terms of additional clarity beyond what you already knew and and how do you let that inform how you're advising your your client and your projects in 2026, you know, to develop things in the United States?

Yeah, I mean for all all due respect for for the work Taylor is doing and the SEC um I I feel like 2026 has been all about the vibes and nothing really substantive. Um if for me I would like to think that if we are going to have a way forward rather than the SEC coming kind of rubber stamping what prior projects have done give us a roadmap that projects can follow into the future. Um the you know what came out in March where it the SEC listed a bunch of tokens and said these are not securities they're commodities. I think that's a great signal for those projects themselves. But what would have been really, really, really helpful is for the SEC to do their work, if they did a howi analysis, if they did something else, show me how you came to the conclusion that those tokens are not securities and they are commodities.

Because just saying Salana is not a security and it's a commodity, that's a great win for the Salana ecosystem and it makes us, you know, happy that we got some justification of what we've believed. Um, but at the same time, what do you do for other token projects? What do you do for for projects right now? Um, if if new rulemaking comes into play and we kind of have this safe harbor for these new tokens that are going to come onto the market, give me the test that you Show me the work is basically what I want. Give future projects a chance to be able to compare their token to prior tokens in order to fall on the right side of the line.

Um, so for me, I feel like that would be the much more helpful um things to come out of the SEC. Um, I I think with with the transfer agent stuff, it it's it's interesting, but again, we're still talking about centralized intermediaries at this point. Um I I think the SEC has been doing a great job on focusing on more centralized and and and trusted intermediaries in in the digital asset space. Um but I think there's a huge gap on the more decentralized protocols. Um I think the you know what came out in March is great for token treatment.

Um but what it doesn't talk about is how how do developers know that they are actually developing a decentralized protocol that will fall outside of securities regulation.

David, anything to add on top of that? I know one of the things we talked about in a group is just the importance of early market positioning and not waiting for perfect clarity. Any anything to piggy back off of the comments?

Exactly. If you talk about what's decentralized, I would that less stable that I mean I've done that how analysis22 and that's not where the industry is anymore I would argue the guidelines obviously I would argue that that's it seems unlike that seems to be done the interest all the focus and all the money now is focusing on new infrastructure how do traditional finance world.

I do disagree.

Okay.

There there's so many um I maybe it's just because there it's it's a different user I mean user base. Um there is a lot of talk about tokenization and using digital asset and and blockchain infrastructure to change finan services today. Um, but it that's easy to understand. I mean, people who don't understand open permissionless networks, they understand things like traditional finance. And if it's just putting new tech stack behind it, of course, people are going to understand it.

People understand stocks, people understand bonds, tokenizing those things and the promises of what blockchain infrastructure can do for those things. But I think when you are now talking about peer-to-peer networks. Um, DeFi has not dead. Um, there are still decentralized protocols. There are still decentralized lending protocols.

There's credit. Um, you know, I think we can argue whether or not vaults are can be decentralized or not. Um, but there still is that ethos of of trying to build peer-to-peer networks where you don't rely on intermediate areas where you are trusting that you can trust the code um to be able to do the things that you want to do. So I I think that even though there is a lot of emphasis on tokenization and tokenized equities and all those things, it's because that's what the general public can understand. It's it's what they're used to.

It's what they're doing. Um and you have a lot of institutions who finally feel that they're able to join like hop on the bandwagon because it's it's their bread and butter. they know what they're doing there. Um, but there are also many debates going on right now on whether or not institutions are able to participate in DeFi. They see DeFi as being able to have all these different yields and all these other benefits um for participants and institutions want in on it, but they're still trying to find ways that they're able to engage with DeFi protocols due to their BSA and other compliance requirements.

So, I I do a world where both exist. Um, right now with the way things are in the US, I do think it's going to go more towards the permissioned centralized route and maybe DeFi stays offshore.

I agree it will stay offshore. I mean, I came into the SEC as an expert in decentralization and networks. That's my background. And essentially, I would argue the nuances have been ignored and have faded into the dust and will never come back. And so you'll never see a great deal of debate about decentralizing.

It's gone.

Ron, I'm seeing you nodding your head. I was wondering if you have any reactions and if you can draw this to the experience you've had working at Windsor Mute at all.

Uh I'm just nodding because I'm not a lawyer and thank god I'm not involved in these conversations as much anymore. So to be completely candid um you know I Troy had a great point earlier um talk about just like look this space evolves so much. Um and when I was writing legislation back in 2017 like stable coins and meme meme coins were not a thing. Um, but like hypothetically if the bill I wrote back in 2017 like moved into law, then like you know we have all these questions about these like really big products like stable coins out there and a lot of the regulation thankfully was solved with the Genius Act, but like if you're going to trust Congress to be forward thinking, good luck. Um, but like the truth is like also you need a regulator that actually responds and like engage with industry.

Um, and actually we had an issue when we were applying for a broker deal license. We had a couple issues with FINRA. Uh, actually good old Taylor was a great resource we use to help out um, at least kind of navigating the bureaucracy as well as navigating how to talk to FINRA. how it's different from the SEC. That was not the case four years ago.

I mean, I've never been on stage with Hesser Pers. And she said, "Hey, look, if the SEC reaches out to you, again, this is four years ago, different administration now, but four years ago, she said, "If the SC reaches out to you, it's it's the fintech task force uh of sorts at the time, uh don't go in. It's a trap. You're you're going to get like a lawsuit uh the next day." And so, like or you know, later on down the road.

And like that was a real thing coming from the commissioners to tell an industry it's a trap. uh and like that, you know, if you're a business, especially one like ours in the UK, you're trying to launch United States, if you have regulatory questions and the main regulator you can't talk to because you might get a multi-million dollar lawsuit after the fact, why would you get engaged? And that's why when we got involved um actually right after the Trump administration won, they decided to, you know, launch operations and apply for the broker dealer. Uh and there are still plenty pain points that we've all highlighted here, but uh yeah, sorry, I'm more nodding because I'm not a lawyer, so I'm really happy to not be a lawyer. But I think you're also really highlighting what a welcome change it is to have the administration actually engaged proactively for all the reasons that Taylor discussed among others.

Um so yes, still uncertainty remains but we're definitely going in the right direction. I see we're out of time. I just want to go around the horn very quickly. What is something that you hope to see to advance the industry within the next two to three years?

I have to go last. There's so no I I I think it's um at this point I you know I I don't know there's so many things I can't even do it to one um just believe that this technology is real and it's not trying to rip people off.

What I would like to tell

uh I'd say this message board for the industry folks this is going to be happening a lot more pretty soon especially when the Democrats take over. Uh this they're not going to do a lot of legislation likely split Congress. So, there's gonna be a lot of oversight hearings and a lot of nasty grams. I'm sure y'all remember like when well actually this state senator Elizabeth Warren would send letters. It would go all across the media saying Elizabeth Warren's going to bring in, you know, Binance or whoever, you know, pick a company, pick an industry, and everyone freaked out.

The stock price take a hit, all this stuff. And then you realize halfway through like, oh, it's all theater. They get yelled at and there's nothing that happens afterwards. Um, but like that's the whole point. They wanted to shake the tree and they wanted to rattle the CEO or bring Zuckerberg or whoever in.

There's gonna be a lot of that in the next two years. you know, some of it warranted, some of it unwarranted, but like crypto has been a list um for both the House and the Senate. So, whichever one the Democrats take over, get ready for a lot of, you know, hearings that are not going to lead to anything, but they're going to shake the tree and then and get be great for the media and stuff like that. But overall, in terms of business and structure and what's happening in the SEC, it's not going to be that effective. It's just going to go the headlines.

So one of the things that I think is really really helpful in this space and other spaces is when the tangible ways in which whatever folks are working on can actually improve people's lives. I I I think discussions in so many different contexts can be esoteric, technical, jargony, etc. And I'm I I I do this by myself. Use the short hand because it's a way to get through a conversation. And yet the all right, how is this going to make that person's life better in this way or another or that institution's life better?

What what what are we what are we solving? What are the ways in which in a tangible sense? I think those stories, the more those stories are not made up, but are authentically and genuinely able to be told and communicated because then what that creates is it creates an environment where policy makers say, "Okay, well, I want I want more of that. That's a good thing. How do I get more of that?"

Well, here here's a way you can get more of that. And there are balances to be struck. There are risks to be to be managed and to and to tend to. But I think often though, what's the positive affirmative case for can use behind it and I think that's uh that's an important thing to continue to respond.

That's a hopeful note. David, one sentence, two sentences.

Sadly, I think the centralization will be out in three years and it'll become central. Everything will become centralized driven by the players we know and love. Uh and I'm sad about that.

Okay. Well, um let's stick with Troy's hopeful note, but but David, we'll follow up with you to see if your your prediction comes to fruition. Thank you all for your attention.