Fairmint calls on SEC to adopt blockchain framework for private equity markets

Onchain securities platform Fairmint has urged the United States Securities and Exchange Commission to adopt a blockchain-powered regulatory framework to modernize private equity markets.

On June 16, Fairmint, which operates as an SEC-registered transfer agent and develops infrastructure for compliant onchain securities, submitted a comprehensive seven-point policy proposal to the SEC’s Crypto Task Force, outlining how blockchain technology can be used to replace outdated administrative systems in the $6 trillion U.S. private securities market.

In its submission to SEC Chairman Paul Atkins and Commissioner Hester Peirce, Fairmint outlined operational challenges in private markets and proposed solutions that it claims can be implemented under current regulatory authority.

Fairmint argues that much of the sector still operates on outdated infrastructure and relies on costly, spreadsheet-based systems with no native settlement capabilities, limiting efficiency and regulatory transparency. In contrast, public markets benefit from regulated infrastructure.

The seven-part framework is expected to standardize infrastructure across transfer agents, provide real-time observability to regulators, and expand investor rights and access.

Fairmint’s proposal begins with a push to unify private market infrastructure through protocol-level interoperability, aiming to eliminate the fragmented systems that currently burden transfer agents. 

To enhance regulatory oversight, it proposes blockchain-based observer nodes that would allow the SEC to monitor transactions in real time while preserving user privacy. Another key recommendation supports investor self-custody, enabling direct ownership of private securities with embedded compliance measures.

The proposal also challenges traditional investor qualification standards by advocating for a knowledge-based accreditation model, replacing outdated wealth thresholds with competency assessments.

To support new types of market activity, Fairmint outlines a non-custodial broker-dealer structure for smart contract-based intermediation and encourages the creation of a supervised DeFi sandbox for controlled experimentation.

Lastly, Fairmint recommends replacing traditional clearing systems with a direct settlement architecture powered by smart contracts to streamline settlement and reduce reliance on intermediaries.

By adopting its proposed framework, Fairmint argues the SEC could enhance market integrity and reduce administrative burdens while enabling innovation through secure, onchain processes.

With regulatory momentum building around digital assets, Fairmint is among a growing number of firms advocating for policy reform. Under the Trump administration, the SEC has recalibrated its regulatory strategy, marked by the establishment of a dedicated Crypto Task Force to explore new policy approaches and modernize oversight frameworks.

Since its formation, the Crypto Task Force has actively sought industry feedback and held a series of regulatory roundtables with various stakeholders, focusing on areas such as tokenization, decentralized finance, and the application of existing securities laws to blockchain-based systems.