SEC Boosts Bitcoin and ETF Altcoins by PoW Compliance

Recently, the SEC officially recognized that the Proof-of-Work (PoW) mining mechanism is not classified as a security, providing greater regulatory clarity for this technology. This is a positive signal not only for Bitcoin – the world’s leading cryptocurrency – but also for PoW-based altcoin ETFs.

Newest move from SEC

In a newly released statement, the U.S. Securities and Exchange Commission (SEC) clarified its stance on securities regulations concerning cryptocurrency mining under the Proof-of-Work mechanism. 

Specifically, the SEC determines that both solo mining and pool mining do not constitute securities transactions under U.S. securities laws. The mined crypto assets, termed “Covered Crypto Assets,” do not meet the criteria to be classified as securities. PoW mining is a decentralized network governance activity, where rewards depend on computational power and miners’ participation, not on the entrepreneurial or managerial efforts of third parties.

JUST IN: 🇺🇸 SEC publishes guidance on proof of work mining 👀 pic.twitter.com/YSKhrESy4Q

— Bitcoin Magazine (@BitcoinMagazine) March 20, 2025

The SEC emphasizes that this statement aims to provide transparency and clarity to the cryptocurrency industry, particularly amid growing regulatory questions. It notes that these activities do not require SEC registration under current securities laws, as long as they do not involve issuing or selling assets as investment contracts. However, the SEC leaves room for case-by-case evaluation if additional factors, such as fraud or differing transaction structures, arise. Overall, this statement marks a significant step in reducing legal uncertainty for PoW mining participants, while reaffirming the SEC’s principled approach to blockchain technology.

Learn more: SEC Declares Memecoins Are Not Securities

Open door for ETF altcoin 

Since President Trump took office, he has pushed for reforms in U.S. financial regulators, including the SEC and CFTC, urging them to ease crypto regulations. Soon, the SEC is set to appoint Paul Atkins, a pro-crypto advocate, as its new chairman.

Currently, under Acting Chairman Mark Uyeda, the SEC has established a dedicated crypto task force and restructured its personnel. Specifically, the SEC recently dropped lawsuits against several crypto firms, including OpenSea, Coinbase, Robinhood, Cumberland KRW, Consensys (MetaMask), Kraken, Yuga Labs, BitClout, Uniswap, and Ripple.

Additionally, this latest move by the SEC signals greater regulatory clarity for blockchain technology and Proof-of-Work (PoW). This could pave the way for the approval of Bitcoin and other PoW-based altcoin ETFs, such as Litecoin and Dogecoin, in the near future—assets that already have a high likelihood of approval this year.