As a seasoned analyst with over two decades of experience in the financial sector, I find myself intrigued by this recent call from the Digital Chamber’s Token Alliance for a comprehensive review of all existing crypto-related investigations by the SEC. Given my career trajectory, which has seen me navigate through numerous regulatory shifts and evolutions, I can’t help but see parallels between this current situation and the dot-com boom of the late 90s.
A crypto advocacy group has called for the United States Securities and Exchange Commission to initiate an immediate review of all existing crypto-related investigations, Wells notices, and ongoing lawsuits from “day one” of the new Trump administration.
The Digital Chamber’s Token Alliance, including Paul Atkins, a nominee for SEC Chair under Trump, stated that the incoming administration could provide a chance for the Securities and Exchange Commission (SEC) to rebuild its problematic past ties with the digital asset sector.
In simpler terms, they expressed the importance of creating an atmosphere based on mutual trust. This means the digital asset sector should feel assured about the Securities and Exchange Commission’s goals, while the SEC should acknowledge that the majority of digital asset participants are working diligently to act responsibly.
At present, the Securities and Exchange Commission (SEC) is involved in ongoing lawsuits with prominent figures within the sector, such as Binance, Coinbase, Consensys, and Ripple. Additionally, it has issued Wells notices to entities like Uniswap and Immutable, and the resolution of these matters could significantly impact tokens and the broader industry.
Ending “policy” of regulation by enforcement
One suggested rephrasing could be: “Among several key initiatives, the suggestion to scrutinize all ongoing investigations is merely one item on the Securities and Exchange Commission’s (SEC) agenda during their initial 90 days under the new government.
As a researcher, I propose advocating for the Securities and Exchange Commission (SEC) to pursue halts in ongoing legal proceedings that do not directly pertain to instances of fraud, investor loss, or immediate threat to public welfare. This pause would provide the necessary time to refine and finalize our strategic approach.
The SEC aims to revoke the 2019 guidelines regarding the interpretation of the Howey test’s investment contract aspect as it pertains to digital assets, and instead, formally state that they will not rely on the Hinman speech when conducting such analyses.
According to the Digital Chamber, the speech given by William Hinman, a former SEC Director in the Division of Corporate Finance, has unfairly established a situation where some entities are winners while others are losers.
Additionally, The Digital Chamber advocates for the revocation of the rule outlined in Staff Accounting Bulletin 121 (SAB 121).
Under the proposed rule SAB 121, companies reporting to the Securities and Exchange Commission (SEC) who hold cryptocurrencies will be required to list these digital assets as liabilities in their financial statements.
According to the Digital Chambers, they believe such a regulation might be too heavy for market participants. On the other hand, Representative Wiley Nickel of the House suggests that this rule might cause U.S. investors to seek potentially riskier overseas custodial options instead.
The bill aimed at repealing SAB 121 gained backing from both parties in the House and Senate, but it was ultimately vetoed by President Joe Biden.
As a crypto investor, I’m keeping an eye on the potential changes with the SEC. They’re contemplating whether they should reconsider and possibly withdraw Rule 3b-16, a proposal that aimed to broaden the definition of “exchange” to encompass decentralized finance protocols like mine. This could significantly impact the regulatory landscape for my investments in the crypto space.
Gary Gensler, widely known for his role in shaping the Securities and Exchange Commission’s (SEC) enforcement-focused regulatory strategy, is planning to step down on January 20th. There are indications that he may be succeeded by Paul Atkins, a former SEC commissioner who served from 2002 to 2008.
The suggestion made by The Digital Chamber might carry significance since Atkins is a member of their advisory board.
The Digital Chamber announced that top officials from the Token Alliance’s governing body held discussions with SEC Commissioners Hester Peirce and Mark Uyeda, outlining their proposed digital asset policies for the year 2025.
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2024-12-19 08:53