Eight Takeaways From My Conversation with the SEC Crypto Task Force’s Chief Counsel

At the Crypto with Katten symposium on June 3, I had the opportunity to sit down with Taylor Lindman, Chief Counsel of the Securities and Exchange Commission’s (SEC) Crypto Task Force, for a wide-ranging discussion on the Task Force’s agenda, its evolving regulatory approach, and how market participants should be thinking about engagement. Taylor and I go back to the early days of crypto, having worked together at a prior firm alongside current Commodity Futures Trading Commission (CFTC) Chair Michael S. Selig. It’s been rewarding to watch Taylor’s trajectory in this space – and our conversation reflected the depth of experience he brings to the role. Below are my key takeaways from our discussion.

1. The Crypto Task Force Operates in Two Lanes, and the Second Is Where the Action Is

Lindman described the Crypto Task Force’s work as falling into two distinct buckets. The first, defining what is and isn’t a security under the investment contract analysis, consumed much of the early focus. But since December, when the Depository Trust & Clearing Corporation (DTCC) no-action letter kicked off a new phase, the second bucket has taken center stage. The central question now is how existing market infrastructure, including the standard plumbing of broker-dealers, transfer agents, and clearing agencies, works when translated to blockchain rails. This is where the most significant regulatory development is happening right now, and it’s where practitioners should be paying closest attention.

2. “Durability” Is the Watchword

If there is one concept that pervades the Crypto Task Force’s approach, it’s durability. Lindman repeatedly emphasized building “a consistent bedrock” that will “be carried forward by market participants and ultimately become the standard upon which things are built.” The implication for the market is that, while the pace may feel deliberate, the SEC is prioritizing permanence over speed. These are not quick fixes. They are meant to be the foundation for everything that follows.

3. The Rulemaking Pipeline Is Real and Progressing

Lindman laid out a clear trajectory: staff-level guidance leads to no-action letters, which builds into conditional interpretations, which feeds into formal notice-and-comment rulemaking. That pipeline is active. Lindman noted that within the SEC, specialists in each Division are working “like artisans” on specific rules, some of which they’ve been “living with and sculpting for sometimes decades.” The Task Force’s role is to serve as a translation and coordination layer between divisions, ensuring the technology’s purpose isn’t lost as rules take shape. As a former SEC attorney, I found Lindman’s characterization of the staff spot-on, and it signals that the institutional knowledge being brought to bear here is substantial.

4. The Innovation Exemption Is Focused on On-Chain Trading

Without commenting on timing, Lindman was clear on scope: “Conditional exemptions come with conditions. There are a lot of conditions.” The innovation exemption is focused squarely on enabling on-chain trading of securities. It’s designed to complement, not replace, other SEC work on token standards and clearing and settlement. It will sit alongside alternative trading systems (ATSs) and national securities exchanges already developing blockchain capabilities. Market participants should think of it as one piece of a broader trading infrastructure puzzle — not a standalone sandbox.

5. Tokenization Is Not One Thing, It is Three

This was the most practically useful part of the conversation. Lindman laid out three distinct tokenization models the Crypto Task Force is analyzing:

The first is the issuer-sponsored model, in which a transfer agent natively issues tokenized stock or other instruments directly on-chain.

The second is the custodial model, in which a central securities depository or custodian issues entitlements embodying rights to the underlying asset, with downstream tokenization by a broker-dealer or clearing agency like the DTCC.

The third is the synthetic/separate securities model, involving debt instruments, equity-linked notes, security-based swaps, or futures that provide economic exposure to an underlying asset without conferring rights to it. These are entirely separate securities from the underlying.

The foundational message: “When you tokenize a security, it doesn’t cease to be a security.” Lindman urged the industry to stop focusing on the technology wrapper and instead ask the traditional question: What is this instrument? Is it a National Market System (NMS) stock? A fund interest? A derivative? The answer dictates the regulatory framework — the blockchain is incidental.

6. Interoperability Will Be Regulated on Substance, Not Form

On cross-chain interoperability, Lindman articulated a clear principle: “If it’s the same instrument, if it embodies the same rights, and if it has the same trust assumptions, it’s likely to be regulated the same way.” Conversely, if bridging an asset to another chain changes its characteristics by altering rights or trust assumptions, that difference could lead to a different regulatory outcome. Firms building cross-chain infrastructure should treat this as a critical design consideration. They must either maintain fidelity to the original instrument’s properties or be prepared for potentially different regulatory treatment.

7. The Crypto Task Force Wants to Hear from You, Specifically

This isn’t pro forma. The Task Force has conducted more than 200 meetings, and Lindman called them “the lifeblood of what keeps us relevant.” They read every written submission through the Task Force portal daily. Lindman identified three specific areas where they need more market intelligence: (1) broker-dealers interested in touching blockchain rails; (2) investment managers exploring on-chain investment activities; and (3) tokenizers, meaning anyone experimenting with tokenizing debt or equity or running internal collateral experiments. If you’re active in any of these areas, engaging with the Task Force is not merely an option; it is how you shape the rules that will govern your business.

8. Lindman’s Technical Background Is Shaping the Crypto Task Force’s Approach

One detail that shouldn’t be overlooked. Lindman bought his first Bitcoin in 2013, lost funds on a defunct exchange called Bitcoin 24 (shut down by Polish Interpol), and then spent years understanding blockchain technology at the deepest possible level, from code and development stacks to smart contract design. Having a chief counsel who has personally experienced exchange failures, practiced self-custody, and can read the underlying technology is not window dressing. It signals that the Task Force is approaching these issues with genuine technical fluency, not just legal abstraction.

Practical Implications

The overarching message from my conversation with Lindman is that the SEC’s crypto regulatory framework is being deliberately built through established processes, with genuine interest in market input. For market participants, the practical implications are straightforward. Engage early and substantively through the Task Force portal or meeting requests. Understand that tokenization does not change the fundamental nature of a security. Design interoperability infrastructure with regulatory consistency in mind. And prepare for conditional frameworks, particularly around on-chain trading, that will come with meaningful compliance obligations.

The window for shaping these rules is open. It won’t stay open forever.

Note: Taylor Lindman’s views as expressed in our conversation are his own and do not necessarily represent the views of the Securities and Exchange Commission or its staff.