The Federal Communications Commission just put submarine cables, the actual physical backbone of the global internet, under a regulatory microscope. The agency unveiled new rules on June 3 that would, for the first time, require operators of Submarine Line Terminal Equipment (SLTE) to obtain FCC licenses.
Here’s why that matters: submarine cables carry 99% of international internet traffic. Every crypto trade routed through an overseas exchange, every cross-border stablecoin transfer, every piece of data flowing between continents travels through these undersea fiber optic lines. The FCC wants to make sure none of that infrastructure relies on equipment from Chinese companies or other foreign adversaries.
What the new rules actually do
The draft Second Report and Order targets a regulatory gap that’s existed for decades. While the cables themselves have been subject to FCC oversight, the terminal equipment on either end, the hardware that lights up those fiber strands and routes traffic, has operated in a licensing gray zone. That’s about to change.
The rules also systematically exclude equipment and services from companies on the FCC’s Covered List. That means Huawei, ZTE, and HMN Tech are effectively locked out of US submarine cable infrastructure. No exemptions. No grandfathering of existing equipment. A clean break.
