SEC Chairman Not Willing to Change the Laws for Cryptocurrency

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United States Securities and Exchange Commission (SEC) Chairman Jay Clayton says he won’t make exceptions in securities law for cryptocurrencies, however, the same man has always been quite progressive on this new form of asset. In that, Clayton has said that there is no need to get in the way of cryptocurrency’s progression either.

The SEC has long been one of the strongest determining regulators in regards to how Bitcoin and other cryptocurrencies are accepted and expanded. The SEC has clamped down heavily on ICOs in the past, deeming many to be under their jurisdiction, and probably caused the collapse of that phase. 

More so, the SEC is also in the spotlight with regards to its potential to allow for what many think will be the holy grail of cryptocurrency adoption - Bitcoin ETFs. Currently, the regulatory body has a number of applications on its desk that it is mulling over. 

Now, its chairman Clayton, who made positive remarks about Bitcoin a while ago, has said that he is not ready to reshape the securities law for the sake of cryptocurrency, but he is not one to stand in its way either. 

‘It ain’t happening’

Speaking in an interview with Bloomberg, Clayton expressed his thoughts on the laws and the new technology.

“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,” Clayton said

However, the SEC chairman 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 laws, to allow it to happen.’’

All for Bitcoin, concern elsewhere

Calyton has always defined his understanding of the cryptocurrency space against what Bitcoin is to it, [compared to a number of ICOs which the SEC have quickly shut down. 

“Cryptocurrencies are replacements for sovereign currencies. They replace the yen, the dollar, the euro with bitcoin. That type of currency is not a security,” he said in an interview with CNBC. 

In terms of other cryptocurrencies, such as Ethereum and XRP under Ripple, the SEC has had mixed feeling srecently. In the case of Ethereum, it has not been expressed outright by anyone in the SEC that it is not a security, but the general feeling is that the SEC is nor concerned with it. 

The SEC Director of Corporate Finance, William Hinman, however did say in a speech that the SEC does not consider Ether, the Ethereum network’s native cryptocurrency, to be a security:

"Based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions."

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