Is This SEC No-Action Letter a Significant Victory for DePin Initiatives Such as Helium?

Regulatory frameworks play a vital role in the crypto space. Without conducive governmental regulations, maneuvering through the ecosystem becomes exceptionally difficult. By 2025, with Donald Trump back in office, the United States is taking the lead in terms of regulatory transparency. Up until now, DeFi and tokenization initiatives have been at the forefront, exemplified by the GENIUS Act. Nonetheless, DePin projects are beginning to achieve equally impressive advancements.

This marks a significant triumph, particularly because the essence of crypto lies in enhancing efficiency and granting users more control. Successes for projects that promote these ideals are crucial. As reported by Coingecko, DePin is an emerging crypto niche managing over $16.9 billion in assets. Within this realm, some of the top cryptos to consider include Bittensor, Render, and Filecoin. Nonetheless, a number of new DePin initiatives are specifically designed for the Solana blockchain, where recent regulatory updates could significantly shape the future of the sector.

(Source: Coingecko)

At the heart of this development is DoubleZero, a DePin platform focused on optimizing distributed record consensus with a primary focus on Solana. The team is committed to improving Solana’s scalability by reducing data travel among validators, potentially increasing throughput to 1 million transactions per second. Essentially, DoubleZero integrates underutilized private fiber-optic connections into a platform designed for powering decentralized applications.

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DoubleZero, the SEC, and the No-Action Letter

DoubleZero’s goals are ambitious, yet the team recognizes that adherence to regulations, particularly in the U.S., is essential.

In an unusual display of restraint, the SEC released a no-action letter to DoubleZero on September 29, effectively endorsing the project’s systematic distribution of 2Z tokens.

Responding to an inquiry from DoubleZero, the agency’s Division of Corporation Finance indicated it would refrain from recommending enforcement action against the project or its smart contracts involving 2Z coin transactions; provided the conditions remain unchanged and the crypto token operates solely as a utility.

Proud to share that the @SECGov has issued @DoubleZero a No-Action Letter for 2Z.

The first-of-its-kind No-Action Letter gives us confidence that 2Z does not have to register as a class of “equity securities” and that programmatic flows of 2Z on the DoubleZero platform are… pic.twitter.com/gSgiN6tpQj

— DoubleZero IBRL/acc (@doublezero) September 29, 2025

Significantly, the SEC concluded that 2Z tokens do not fulfill the Howey Test criteria, the Supreme Court’s benchmark for distinguishing between investment contracts (and thus securities) and commodities. The rationale? Benefits from 2Z are contingent upon the efforts of participants, rather than the promotional endeavors of DoubleZero.

Similar to numerous tokens, including those available on Binance, 2Z will reward protocol participants. The SEC commented that these tokens are classified as non-securities under federal regulations. This decision arrives just before DoubleZero’s mainnet beta launch on October 2.

Validators are required to pay in 2Z to connect to the platform, while providers receive algorithmically determined rewards based on their contributions, including bandwidth and latency enhancements. A portion of transaction fees is burned to mitigate inflation, and holders have the opportunity to stake 2Z for further yields.

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A Breakthrough for DePin? What It Means For Platforms Like Helium

The crypto community has enthusiastically welcomed the no-action letter. This is understandable: these letters are specific to the facts presented, serve as non-binding staff opinions rather than formal regulations, yet act as significant compliance benchmarks.

DoubleZero’s legal representatives, Cooley LLP, characterized the SEC’s response as a “significant landmark in the compliance of crypto assets” that could create “a viable pathway for crypto initiatives to compliant coin distribution in the U.S.”

Crypto-friendly SEC Commissioner Hester Peirce shared this perspective, asserting that the guidance allows for more innovative efforts. She emphasized that “the success of crypto projects should be dictated by the markets, not financial regulators.”

On X, Helium, a decentralized wireless platform, recognized the SEC’s position on DoubleZero’s coin as a “great day” for DePin.

Earlier this year, the commission had filed a lawsuit against Helium’s developer, Nova Labs, alleging that its native HNT token was an unregistered protection.

Today marks a major win for Helium and The People’s Network! The SEC has agreed to dismiss its unregistered securities claims with prejudice. Helium Hotspots and the distribution of HNT, MOBILE, and IOT through the Helium Protocol are not securities. It also means that the SEC… pic.twitter.com/vJSBAFht8T

— Helium (@helium) April 10, 2025

However, by April 2025, the SEC dropped the case, and Nova Labs consented to a minor $200,000 civil penalty, considerably less than the original $42 million sought.

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