SEC changes token buyback guidance as spending hits $638M

The US Securities and Exchange Commission tightened its guidance for crypto token buybacks just three days after publishing it.

On Sept. 25, SEC staff said a token issuer could announce a buyback without that announcement being treated as a promise to manage the token's value, as long as the crypto system was already functional. On Sept. 28, the agency changed that answer by adding another condition: the system must also have “no central party.”

It represents an important change to the guidance, as many crypto projects use buybacks while still giving people, companies, or committees some control over how those purchases happen.

The SEC staff's updated answer now says that a buyback announcement for a non-security crypto asset would not, by itself, amount to a promise of essential managerial efforts when the system is both functional and has no central party.

If the system is not yet functional, the SEC staff says a buyback announcement could count as such a promise if the issuer presents the purchases as a way to generate yield or returns for holders.

The change comes as token buybacks have become increasingly important across crypto. Crypto projects spent a record $638 million on token buybacks through late August, according to previous CryptoSlate reporting.

The FAQ reflects the views of SEC staff. It is not legally binding and does not determine whether any particular token is a security. Still, the change raises a practical question for projects using buybacks: who actually controls the buying?

A project may have already spent millions buying its token, but that number says little about who can decide whether the next purchase happens, how large it is, or whether the program stops entirely.

The SEC gave a clearer definition of a “central party” in its March crypto-asset interpretation.

It defines a central party as a person, company, or group that has operational, economic or voting control over a crypto system. A decentralized system, by contrast, operates without that kind of control.

That definition applies to the crypto system as a whole. So, having control over a project's treasury or buyback program does not automatically mean the entire system has a central party. But it can be one piece of evidence when looking at who holds economic control.

This becomes important when a project combines automatic buybacks with decisions made by people.

A smart contract might automatically buy tokens under one part of a program, while a company, committee, or DAO can decide whether other purchases happen.

The key question is therefore not just whether some buying happens automatically, but whether people still have meaningful power over the system and its economic decisions.

Pump.fun is a good example of this. In an April 28 disclosure, the platform said references to PUMP purchases and a “buyback program” generally described plans or smart-contract functions rather than a firm promise to buy tokens. It made an exception for purchases that were already programmed to happen automatically through on-chain code deployed before April 28, 2026 UTC.