SEC Issues No-Action Letter to Solana Ecosystem's Fuse, Marking Regulatory Breakthrough for DePIN Sector

The U.S. Securities and Exchange Commission (SEC) officially issued a no-action letter this Monday to Fuse, a Solana-based decentralized physical infrastructure network (DePIN), confirming that it will not take enforcement action against the sale of its FUSE token. This is the second time within just three months that the SEC has granted such regulatory exemption to a DePIN project, following the Double Zero project in August. It marks a more pragmatic approach to token regulation under the new leadership of Chairman Paul Atkins. This decision provides a clear compliance path for token projects focused on real-world utility rather than speculative functions, potentially serving as a significant turning point in the relationship between the crypto industry and regulators.

Key Signals of the SEC’s Policy Shift

On November 19, 2025, the Fuse project officially submitted a no-action letter application to the SEC Division of Corporation Finance, seeking assurance that the regulator would not take enforcement action against its FUSE token sale plan. In its application, the Fuse team emphasized that its token is strictly designed for network participation functions, not speculative investment, and is primarily used as a reward mechanism for users maintaining distributed infrastructure. Notably, FUSE tokens can only be exchanged at prevailing market rates on third-party exchanges, a design that clearly distinguishes it from traditional securities with expectations of profit.

This Monday, the no-action letter signed by Jonathan Ingram, Deputy Chief Counsel of the SEC Division of Corporation Finance, officially confirmed that, based on the facts presented by Fuse, the division will not recommend enforcement action regarding the offering and sale of tokens as described. This decision continues the SEC’s recent friendly attitude toward DePIN projects; as early as August, the agency issued a similar letter to the Double Zero project, which caused a stir in the industry and was seen by many observers as an important indicator of changing regulatory attitudes.

Double Zero co-founder Austin Federa highly praised the SEC’s review process, calling it “professional, diligent, and free from crypto bias,” and described the approval as a “highly sought-after regulatory recognition.” While no-action letters are common in traditional finance, they are extremely rare in the crypto industry, making two consecutive approvals particularly noteworthy. Earlier this year, a leadership reshuffle at the SEC put Commissioner Hester Peirce—long regarded as an industry innovation advocate—in charge of the crypto working group. This personnel arrangement is clearly having a substantial impact.

Legal Significance and Industry Impact of the No-Action Letter

From a legal standpoint, professionals were not surprised by the decision to grant Fuse a no-action letter. Consensys attorney Bill Hughes pointed out that, given the consumptive design and limited utility of the FUSE token, “no crypto lawyer” would classify it as a security. This professional consensus stems from the token’s clear functional positioning—as a reward and participation credential for network services, with no involvement in investment contracts or profit-sharing arrangements. This design deliberately avoids the key elements of the Howey Test, namely investment of money in a common enterprise with a reasonable expectation of profits derived from the efforts of others.

Solana ecosystem attorney Rebecca Rettig explained the core motivation for crypto projects to seek no-action letters: they provide “regulatory clarity”—a reasonable assurance that launching a token will not immediately trigger SEC enforcement. She describes such letters as “regulatory cover.” While they do not create new legal precedent, they offer practical peace of mind for project operations. This clarity is particularly critical for DePIN projects, which often require substantial upfront capital investment for physical infrastructure deployment—an area where regulatory uncertainty has long deterred traditional capital.

Recently, the SEC’s regulatory easing has not been limited to token classification. The agency has also granted no-action relief to certain crypto custodians lacking banking licenses—another area that had previously stalled under former leadership. Meanwhile, Chairman Atkins is considering establishing a “token taxonomy” at the federal regulatory level to clarify classification standards for specific crypto assets. Earlier this month, Atkins announced that he is weighing the creation of a token taxonomy “based on the long-standing Howey investment contract securities analysis” as the next phase of the SEC’s “crypto project” initiative.

Key Information from the SEC No-Action Letter

Applicant: Solana ecosystem DePIN project Fuse

Application date: November 19, 2025

Approval date: November 24, 2025 (Monday)

Token name: FUSE

Token function: Network participation reward mechanism

Legal basis: Howey Test exemption

Recent similar case: Double Zero (August 2025)

Regulatory head: SEC Commissioner Hester Peirce

New Opportunities and Compliance Paths in the DePIN Sector

Decentralized physical infrastructure networks (DePIN)—the crypto industry’s most tightly integrated bridge with the real-world economy—are now enjoying unprecedented regulatory clarity. These projects use token incentives to mobilize distributed communities to deploy and operate real-world physical infrastructure, covering areas such as wireless networks, energy grids, data storage, and sensor networks. The Fuse project specifically focuses on distributed communications infrastructure, allowing participants to earn FUSE token rewards by deploying and maintaining network equipment, thereby creating a decentralized alternative to telecom networks.

DePIN projects that receive no-action letters typically share several common characteristics: their tokens have clear and immediate utility functions, with core value realized independently of secondary market appreciation; token distribution is directly tied to network usage and contribution rather than public fundraising; the project makes no promises of investment returns, and the team avoids making price projections. Fuse’s application materials specifically emphasized that the token’s value is derived entirely from its utility within the ecosystem, not its speculative potential—a stance clearly recognized by the SEC.

For the entire DePIN sector, the SEC’s successive positive responses provide a replicable compliance template. Project architects can now model their designs after Fuse and Double Zero, clearly separating utility from investment features to reduce regulatory risk. At the same time, this trend is prompting more traditional infrastructure projects to explore tokenization, leveraging global crypto capital and community power to accelerate physical infrastructure construction—especially in sectors with low traditional ROI but high social value.

Future Prospects of the Token Taxonomy

The SEC’s proposed token taxonomy could become a defining moment for U.S. crypto regulation. The framework outlined by Chairman Atkins, based on the Howey Test, aims to provide clear and consistent regulatory standards for different types of digital assets. For the first time at the federal level, this taxonomy could distinguish between utility tokens, security tokens, and payment tokens, assigning appropriate regulatory requirements for each category and ending the current uncertainty of case-by-case assessments.

If the token taxonomy is implemented, projects like Fuse would no longer need to go through the time-consuming no-action letter process; compliance exemption would be automatically granted if the token’s design meets the predefined utility token criteria. This shift would dramatically lower compliance costs, accelerate innovation, and provide investors with a clearer protection framework. Notably, Atkins has emphasized that the new taxonomy will be “anchored in the long-standing Howey investment contract securities analysis,” indicating that any reform will occur within the existing legal framework rather than a complete overhaul.

Industry participants are cautiously optimistic about the token taxonomy’s prospects. Many experts believe that a Howey-based classification framework would be acceptable to courts because it is built on decades of securities law precedent, rather than attempting to create an entirely new standard from scratch. However, the challenge lies in applying this relatively simple test to complex and diverse token economic models, especially those with dual attributes of utility and value accrual. The SEC is likely to adopt a phased implementation, starting with the clearest cases (such as pure utility tokens) and gradually expanding to more complex structures.

The Impact and Outlook of a New Crypto Regulatory Paradigm

The SEC’s decision regarding the Fuse project affects not just a single project but represents a fundamental shift in crypto regulatory philosophy. Under former Chairman Gary Gensler, the SEC was known for “regulating by enforcement,” lacking preemptive guidance and relying on punitive action after the fact, which left the industry in a prolonged state of regulatory ambiguity. The new leadership appears to recognize that a clear and predictable regulatory framework better balances innovation and investor protection.

This shift is already generating positive impacts at a practical level. Founders report that discussions with the SEC are now more pragmatic and constructive, with the agency more willing to provide guidance in the early stages of projects rather than waiting until they are fully developed to take enforcement action. This proactive regulatory approach reduces legal risk for projects and enables more traditional capital to confidently participate in crypto infrastructure investments. Regulatory clarity is especially crucial for DePIN projects, which require significant upfront capital—directly determining whether they can secure institutional funding.

From a broader perspective, the change in U.S. regulatory attitude is also affecting the global competitive landscape. As jurisdictions like Hong Kong, Dubai, and the EU actively foster crypto-friendly regulatory environments, the U.S. faces real pressures of talent and capital outflows. The SEC’s new approach can be seen as a strategic adjustment to maintain U.S. competitiveness in digital innovation. By providing a clear regulatory pathway—rather than simply banning or ignoring the industry—the U.S. stands to retain crypto innovation domestically while ensuring its development remains within manageable bounds.

As more projects follow the template set by Fuse, we may witness explosive growth in DePIN and other utility token projects. Instead of avoiding the U.S. market out of regulatory fear, these projects will actively seek compliance approval, creating a virtuous cycle. While SEC no-action letters are not legally binding, they provide invaluable regulatory guidance to the industry, and such predictability is a key factor for mainstream adoption. On the road to sustainable development for the crypto industry, regulatory clarity is just as important as technological innovation.