The crypto sector known as DePIN (Decentralized Physical Infrastructure Networks) faces significant regulatory challenges, particularly in light of the opaque enforcement strategies left by former SEC Chair Gary Gensler. DePIN projects, which include decentralized cloud services and telecommunications, depend on clear regulations due to their intersection with the physical world. Without a defined regulatory framework, these projects struggle with compliance and often find themselves in legal battles instead of focusing on innovation. Key areas needing clarity include the classification of DePIN tokens as securities or utilities, data privacy concerns surrounding real-world data usage, and consistent global infrastructure deployment standards. A thoughtful regulatory approach could foster growth and innovation, enabling DePIN to bridge digital and physical realms and address critical infrastructure challenges. As the SEC considers its future regulatory stance, prioritizing guidance over punitive measures could benefit both the industry and the agency’s image.

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