Lagrange meets with U.S. SEC crypto asset TF… proposes zero-knowledge proof-based regulatory sandbox

AI blockchain project Lagrange (LA) Labs said on the 16th that it met with the U.S. Securities and Exchange Commission (SEC) crypto asset task force (TF) on the 12th (local time). The two sides discussed digital asset regulatory supervision measures using zero-knowledge proofs.

The meeting was attended by Chief Executive Officer (CEO) Ismael Hishon-Rezaijazade, Head of Business Development Brian Nobel, Chief Scientist Babis Papamanto, and numerous SEC officials. Lagrange proposed introducing a financial surveillance sandbox that applies its own zero-knowledge proof (ZK) technology, "DeepProve." Zero-knowledge proof is a cryptographic technique that can prove the truth of a specific fact, such as regulatory compliance, without disclosing the underlying information.

Lagrange emphasized that this sandbox model could complement the limitations of existing regulatory models. It explained that, instead of extensive data collection, using cryptographic proofs can reduce personal data exposure and ease administrative burdens. It added that providing tamper-resistant proof data could simultaneously improve the efficiency and reliability of regulatory enforcement. The results of the sandbox could also serve as a reference for future policy and rulemaking.

Lagrange cited investor privacy protection, broker-dealer audit simplification, and strengthening AI-based enforcement as representative use cases for the zero-knowledge proof sandbox. It explained that the investor qualification verification process could reduce personal data exposure and that broker-dealers could see reduced administrative burden. By combining cryptographic proof data with the SEC's AI systems, it is expected to secure evidentiary power that is reproducible in court and hard to tamper with.

A Lagrange spokesperson said, "The sandbox we proposed to the SEC points to the future direction of digital asset supervision. Through DeepProve, we can create a compliance framework that is verifiable, preserves privacy, and carries legal effect." They added, "This will be an important advance that balances enforcement, accountability, and investor privacy protection."