Market News… Go Back...

SEC U-Turns on Crypto?

U.S. SEC Head Jay Clayton Surprises the Crypto-community

2019-03-13 10:30:00 | Jonathan Ganor

SEC U-Turns on Crypto?

U.S. SEC Head Jay Clayton Surprises the Crypto-community

 

The U.S. Security and Exchange Commission, known as the SEC has been known to be very harsh in its relations to cryptocurrencies. In the past, the SEC disqualified several Bitcoin ETF proposals, barred U.S. residents from participating in ICOs and constantly spewed FUD on cryptocurrencies in the media. Times have seemed to change though and the new chairman, Jay Clayton appears to be friendlier to the concept of cryptocurrencies.

Coincenter, a non-profit research & advocacy center, has been in constant contact with the SEC. They have contacted the SEC recently in regards to a speech delivered by Director Hinman in June 2018 and asked whether the SEC shares that view point. The SEC had a surprising response.

"Your letter also asks whether I agree with certain statements concerning digital tokens in Director Hinman's June 2018 speech. I agree that the analysis of whether a digital asset is offered or sold as a security is not static and does not strictly inhere to the instrument. A digital asset may be offered and sold initially as a security because it meets the definition of an investment contract, but that designation may change over time if the digital asset later is offered and sold in such a way that it will no longer meet that definition. I agree with Director Hinman's explanation of how a digital asset transaction may no longer represent an investment contract if, for example, purchasers would no longer reasonably expect a person or group to carry out the essential managerial or entrepreneurial efforts. Under those circumstances, the digital asset may not represent an investment contract under the Howey framework."

 The Bottom Line

In their response it appears that the SEC is confirming that Ethereum & Bitcoin are not securities. This may also apply to many other cryptocurrencies. The SEC's response may lay the ground for a change in U.S. regulations for the better & could possibly paint the markets green.

 

As per now the markets have yet to respond to the SEC's response, with Bitcoin still trading at $3900.


BACK TO HOME