In a letter to SEC Chairman Jay Clayton, members of Congress called on the SEC to urgently enact clear and precise regulation regarding cryptocurrencies. A week ago, representatives of the crypto community met with businessmen from Wall Street to discuss the same problem and measures that should be taken by the SEC in this regard.
The SEC currently considers most cryptocurrency assets to be securities that are regulated under the same rules as regular stocks. The only exceptions are Bitcoin and Ether, which are regulated as commodity futures by the Commodity Futures Trading Commission.
The determination of whether a token is a security is based on the Howey test, based on a 1946 court decision. According to Chairman Clayton, the SEC has no plans to change these standards, but may bring greater clarity to existing regulation, as requested by Congressmen. One of the specific concerns identified in the letter is that failure to provide a clear regulatory framework could be detrimental to cryptocurrency innovation in the United States.
The current uncertainty surrounding digital token offerings and sales is hampering innovation in the United States and will ultimately lead to companies venturing into other countries.
We all want fair and orderly markets, we want the same thing. regulators
- said Mike Lempres, a representative of the Coinbase exchange.
From the congressmen’s letter, the following main requests can be identified:
1. The SEC should clarify the criteria used to determine whether offers and sales of digital tokens constitute “investment contracts” and, therefore, an offering of securities. In the current environment, it is unclear what unique characteristics of digital tokens are considered by the SEC when making this decision.
2. Can a token originally sold through an investment contract not be a security? Could the token ultimately be considered separate from the original purchase agreement, which could be considered an investment agreement?
3. The need for recommendations from the SEC for developers of innovations in the crypto sector.
According to unhashed.com
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