US SEC Chairman Says the Rules Won’t Change for Cryptocurrencies
The chairman of the US SEC says he is for technological solutions that reduce the cost of international payments, but the SEC won’t change the law to facilitate them.
United States Securities and Exchange Commission (SEC) Chairman Jay Clayton says he won’t make exceptions in securities law for cryptocurrencies, but he won’t stand in their way either.
SEC rule changes ‘ain’t happening’
Bloomberg published an interview with Jay Clayton on Aug. 27. According to Clayton, he has no desire to change securities laws, either to include or exclude digital assets for regulation. In his own words:
“I think a lot of people got excited that somehow we would change the rules to accommodate the technology and they invested their time and effort thinking that would happen [...] I have been pretty clear from the start, that ain’t happening.’’
However, Clayton does not view himself as being anti-innovation or against good digital payments options, per se. He further said:
“If we have a way to reduce the cost of payments internationally, through technology, I am all for it [...] But you can’t sacrifice basic principles of securities law, and other law, to allow it to happen.’’
Views on Bitcoin and ICOs
Clayton remarked that he does not view all cryptocurrencies as being identical. He does not consider Bitcoin (BTC), for instance, to be a security. However, he remarked that the SEC has determined many initial coin offerings (ICOs) to be fit for securities regulation. Additionally, he reportedly has found multiple ICO white papers disturbing, saying that they use copied language and phrases like “time is running out’’ or “get in early and you get four times as much value,” which raised red flags for regulators.
Recent legal action
The SEC has taken numerous companies to court over misdoings in the course of ICOs. Such proceedings have picked up in recent months. Last week, Cointelegraph reported on a settlement with ICO Rating, a Russian analytics firm that the SEC accused of violating anti-touting provisions.
Also earlier in August, the SEC successfully requested a freeze on assets belonging to Reginald Middleton and his Veritaseum Inc. amid a case alleging that Veritaseum’s $15 million ICO was fraudulent.