SEC's Decision on FUSE Sets the Stage for Regulatory Progress in DePIN Development

Fuse Crypto Limited, the entity responsible for the FUSE token, has received a rare no-action letter from the U.S. Securities and Exchange Commission (SEC), representing a notable regulatory achievement for decentralized physical infrastructure networks (DePIN) initiatives.

, confirming that, as long as the terms in the letter are followed, the FUSE token will not be treated as a security under U.S. law. This follows a similar decision in September regarding DoubleZero’s token, toward crypto projects with practical utility.

The SEC’s Division of Corporation Finance clarified in the no-action letter that it will not pursue enforcement if Fuse distributes its FUSE token as described. The agency’s assessment is based on the token’s function within a decentralized energy network, where participants are rewarded for engaging in sustainability efforts such as solar panel adoption, EV charging, and energy-saving programs. The SEC determined that FUSE does not qualify as an investment contract under the Howey test from 1946, which defines securities as investments in a shared venture with profits coming from others’ work. Instead, the token’s worth is linked to its use in the system, encouraging eco-friendly actions rather than speculation.

This outcome offers important regulatory guidance for the DePIN industry, which has faced ambiguity under the SEC’s previous enforcement direction led by Gary Gensler. The letter reflects the agency’s recent shift under new leadership, including Chair Paul Atkins and Commissioner Hester Peirce, who support a more sophisticated regulatory approach to digital assets. "

would have considered this token a security," commented Consensys legal expert Bill Hughes, highlighting the SEC’s measured analysis. The commission has also suggested it may introduce a "token taxonomy" to distinguish between securities and utility tokens, potentially simplifying future regulatory processes.

This decision could have far-reaching effects on the crypto sector, especially as the Clarity Act—a proposed national framework for crypto oversight—remains in legislative limbo. By issuing no-action relief, the SEC is providing provisional but meaningful support for DePIN projects, fostering advancements in sustainable energy and decentralized infrastructure. Fuse’s achievement may open doors for other ventures aiming to apply blockchain to real-world challenges, such as carbon offset tracking and renewable energy management.

Some observers warn, however, that the ruling is specific to Fuse’s circumstances and does not establish a general rule. The SEC made it clear that the no-action letter is limited to the details provided and

if the situation changes. Even so, this step is seen as a practical move toward balancing innovation in crypto with consumer safeguards, a goal long pursued by industry supporters.

Sources:

SEC says FUSE token isn't a security in new no-action letter

SEC Issues No-Action Letter to Fuse Crypto Ltd for Its Token

U.S. SEC Issues a No-action Letter to Fuse Crypto Amid Stalling Clarity Act

SEC issues 'rare' no-action letter for

DePIN project token FUSE