Aave Labs, Kamino Foundation, and Veda Tech Labs submitted legal analysis to the SEC arguing DAO-governed lending vaults should not be classified as securities.
DeFi & Yields ·
Aave Labs, Kamino Foundation, and Veda Tech Labs submitted a legal analysis to the SEC on October 26 arguing that decentralized lending protocols and DAO-governed vaults should not be classified as securities because they involve no central promise to investors and no entity holding users' assets. The organizations contend that tokenholders' governance of market rules—such as interest-rate models and collateral parameters—constitutes administration of market rules rather than investment management, and that public notice and timelocks allow users to exit before changes take effect. The regulatory determination could determine whether major DeFi vault products must comply with securities registration requirements.