DeFi regulations depend on the underlying business model. Different regulations apply for the peer-to-pool-to-peer (most of DeFi) and peer-to-peer (SmartCredit.io). Transactions monitoring is mandated
Borrowing/Lending regulations drive the respective models. So far, the crypto lending sector has two business models:
Peer-to-pool-to-peer - This is based on assets pooling and offering interest on these pools. Most of DeFi is pooling assets and is therefore automatically classified as a security product (requires an SEC registration)
Peer-to-peer - This is purely peer-to-peer, without pooling any assets. In this case, there is no classification as a securities product (SEC registration is not required). That's what SmartCredit.io is doing.
Virtual Asset Service Provider regulations apply to all CeFI companies. Virtual Asset Service Providers are mandated to do: