a16z advises U.S. regulators: Clarify the boundary between registration obligations for blockchain Protocols and front-end Apps

[Chain Wen] A16z, a major US crypto investment firm, recently submitted a formal opinion on digital asset regulation to the CFTC, with some quite interesting core proposals.

They first suggest that by issuing no-action letters or interpretive guidance, certain qualifying blockchain protocols and smart contracts can be exempt from additional registration — this is to reassure developers. Secondly, for front-end apps with limited functionality and user qualifications (like the wallets and trading interfaces we commonly use), a16z hopes to obtain similar no-action letters or guidance, allowing these apps to avoid complex registration obligations such as FCM, IB, DCM, SEF, and to clarify how to handle compliance certification for enterprise clients (ECP) and cross-border users. The third point is more bold — they propose that the CFTC initiate rulemaking processes to create innovative exemptions or customized registration pathways for apps that do not meet the second category criteria.

a16z also pointed out a practical issue: during past enforcement, there has often been confusion between the functional attributes of Protocols and Apps, and this uncertainty has directly suppressed innovation in the US in this field. Clarifying this boundary is crucial for the industry’s overall standardization.