[SEC Updates Crypto Asset FAQ: Broad Governance Participants Generally Do Not Constitute a "Central Party"] BlockBeats reports that on November 3, the U.S. Securities and Exchange Commission's (SEC) Division of Corporate Finance updated its FAQ on the applicability of federal securities laws to specific crypto assets and transactions. The most recent update was November 2. This FAQ reflects staff opinions and is not an SEC rule, regulation, or commission statement, and therefore has no legal force. The new content primarily clarifies the definition of a "central party." Staff stated that participants in the broad governance framework of a functional crypto system, if unrelated and without a separate agreement to coordinate actions, generally do not constitute a "group of people or entities" as defined. "Central party oversight participation" refers to having control over access to the protocol layer, validator layer, or user layer, such as unilaterally granting or restricting access, deciding or changing upgrade and voting processes, controlling who can participate in consensus, or modifying rule code, rolling back transactions, or revoking access. The FAQ also points out that "functionality" and "decentralization" are different concepts. The functional encryption systems natively containing digital goods possess decentralized characteristics, but the degree of decentralization varies depending on the facts and circumstances. [Original Link]