SEC's Peirce warns some DeFi vaults, onchain lending may fall under securities laws

Policy SEC's Peirce warns some DeFi vaults, onchain lending may fall under securities laws The commissioner said onchain vaults and lending strategies could resemble investment funds or advisers, depending on how they are structured. By Krisztian Sandor | Edited by Nikhilesh De Jul 22, 2026, 3:37 p.m. 2 min read Make preferred on Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Make preferred on SEC Commissioner Hester Peirce (Nikhilesh De/CoinDesk) Summary Show SEC Commissioner Hester Peirce said some crypto vaults and lending strategies may fall within federal securities laws. Morpho's token fell about 5% after the statement, underperforming the broader crypto market. Vaults have become one of DeFi's fastest-growing sector with over $8 billion assets, with Coinbase and Robinhood integrating them to offer yield on users’ stablecoin balances. The U.S. Securities and Exchange Commission (SEC) has signaled that one of decentralized finance's fast-growing sectors could face greater regulatory scrutiny. In a statement Wednesday, Commissioner Hester Peirce said crypto vaults and onchain lending strategies may fall under federal securities laws depending on how they are structured and managed. While many crypto activities lie outside the SEC's jurisdiction, she cautioned that moving them onto blockchain rails does not automatically change their legal status. “Tokenized securities are still securities,” Peirce said, echoing her earlier remarks. “That principle holds for vaults.” “If you do headstands, backflips and other gymnastics to read the law so that it does not apply to crypto assets and activities that are well within the scope of the federal securities laws, you will have a painful fall,” she added. Her comments rippled across the crypto market. MORPHO $ 2.0183 , one of the largest providers of vault infrastructure, fell roughly 5% following the statement, underperforming the broader crypto market. MORPHO price today (CoinDesk) Vaults have become one of DeFi's fastest-growing products by allowing users to deposit crypto into smart contracts that automatically allocate capital across lending markets and other yield-generating strategies. Users receive returns while the vault's rules, or in some cases professional managers known as vault curators, determine where funds are deployed. These vehicles have increasingly expanded beyond DeFi to large exchanges and brokerages like Coinbase and Robinhood as a way to offer users yield on their stablecoin balances. As of July, there were $8.6 billion in assets across 788 curated vaults, reaching 1.4 million, Vaults.fyi told CoinDesk. Peirce noted that vaults span a wide range of designs, from fully automated smart contracts to products where managers or curators select investment strategies, rebalance assets or appoint others to make those decisions. Those activities could resemble investment companies or investment advisers regulated under existing securities laws, she said. She offered similar guidance for onchain lending strategies, saying decisions around interest rates, collateral requirements and supported assets could also raise securities law questions depending on the facts and circumstances. Peirce invited developers to engage with the SEC rather than assuming blockchain technology places them outside the agency's remit. “These new approaches to the deployment of assets hold great promise,” she wrote. “The promise will only be realized, however, if we grapple now with the intersection between these asset deployment tools and the federal securities laws.” DeFi SEC Related Assets Morpho $ 2.02 0.073 % Latest Crypto News 1 UK digital bond plans hinge on one missing piece: onchain cash 1 minute ago 2 Crypto Long & Short: The crypto question isn't what to own — it's what you can survive holding 28 minutes ago 3 U.S. seeks forfeiture of $25 million in crypto tied to romance and investment scams 1 hour ago 4 Forget Nvidia: The next big AI trade could be crypto and blockchain 2 hours ago 5 Kalshi rolls out Midterm Hubs ahead of the November elections in the U.S. 3 hours ago 6 Midnight token rebounds 19% after Wanchain bridge hack, Hoskinson calls for ZK revamp 3 hours ago 7 Here's why bitcoin bulls should take a closer look at interest rates 4 hours ago 8 SecondFi to shut down after $2.4 million ADA wallet theft 4 hours ago 9 Bitcoin retreats from one-month high as oil tops $85, inflation concerns resurface 5 hours ago 10 Kraken parent expands tokenized stocks to Hong Kong, UK and South Korea equities 5 hours ago Latest Research Crypto Flows, Share and the Selective Rotation Crypto Flows, Share and the Selective Rotation Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows. By CoinDesk Research 1 hour ago Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows. Why it matters : Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows. View Full Report More From Policy U.S. seeks forfeiture of $25 million in crypto tied to romance and investment scams Kalshi rolls out Midterm Hubs ahead of the November elections in the U.S. Crypto lobby group Digital Chamber sues Illinois to block digital asset tax More From Morpho UK digital bond plans hinge on one missing piece: onchain cash Crypto Long & Short: The crypto question isn't what to own — it's what you can survive holding U.S. seeks forfeiture of $25 million in crypto tied to romance and investment scams