Institutions such as Aave and the CCI have differing views on the regulatory b

Aave Labs, Kamino Foundation, and Veda Tech Labs submitted a legal analysis to the SEC arguing that non-custodial crypto vaults do not necessarily constitute joint investment vehicles or investment companies under U.S. securities law, even when managers actively select strategies. The Crypto Innovation Council (CCI), alongside members including Bitwise, Galaxy, and Morpho, countered with a framework emphasizing the degree of human control over investment decisions and assets. Aave and its co-authors also noted that vault managers providing paid investment advice on securities may still fall under the Investment Advisers Act, and that their conclusions depend on specific designs and rights arrangements rather than constituting SEC regulatory guidance. The disagreement matters because it tests how far existing securities and adviser rules extend to decentralized vault infrastructure as institutional adoption grows. What to watch next is whether the SEC engages with these competing frameworks or issues formal guidance clarifying the regulatory boundary for non-custodial vaults.