DePIN needs thoughtful regulation — not lawsuits

Key Points

  • The SEC needs to provide clear guidelines for DePIN projects to avoid regulatory ambiguity and legal issues.
  • DePIN projects intersect with the physical world, requiring unique regulatory considerations not addressed by current SEC approaches.

Summary

In his opinion piece for Cointelegraph, Kai Wawrzinek, co-founder of Impossible Cloud Network, discusses the regulatory challenges faced by decentralized physical infrastructure networks (DePIN). He highlights the need for the SEC to shift from a punitive "regulation by enforcement" approach to providing clear, forward-looking guidelines that accommodate the unique nature of DePIN projects. These projects, which include decentralized cloud services, telecommunications, and environmental data collection, operate at the intersection of digital and physical realms, necessitating tailored regulatory frameworks. Wawrzinek argues that without explicit rules, DePIN startups are forced to spend resources on legal compliance rather than innovation, potentially stifling technological advancement. He suggests three areas needing clarity: the classification of tokens, data privacy, and global infrastructure deployment. He concludes that thoughtful regulation could not only benefit DePIN projects but also enhance the SEC's public image by fostering innovation rather than stifling it through litigation.

cointelegraph
March 9, 2025
Stocks
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