When the U.S. Securities and Exchange Commission publishes anything related to the space, the industry immediately pays attention. However, a highly-touted guidance document from the regulator in regards to and ICOs is shaping up to be seen as a case of nothing to see here.
SEC Publishes Guidance for Crypto Sales
The ’s ICO guidance doesn’t do much to further the regulatory conversation, critics allege.| Source: Shutterstock
On Wednesday, the released a outlining its new “,” a product of its Strategic Hub for Innovation and Financial Technology (FinHub).
FinHub is designed to help players in the space.
The latest comments were crafted by Bill Hinman, the director of Division of Corporation Finance and Valerie Szczepanik, senior advisor for Digital Assets and Innovation, who stressed that the framework is not supposed to be an exhaustive overview of the law.
It’s just an “analytical tool to help market participants assess whether the federal securities laws apply to the offer, , or resale of a particular digital asset.”
In the framework (reproduced below), the also chimed in about to say it “can catalyze a wide range of innovation.”
Furthermore, the Division of Corporation Finance that the not pursue enforcement actions against an unregistered .
SEC Document Disappoints Crypto Insiders
Though an important start toward regulating the crypto industry, the framework contained precious little information about how the plans to be more active in regulating the space. Instead, it highlighted the obvious and further obscured what was not. The release states:
“As financial technologies, methods of capital formation, and market structures continue to evolve, market participants should be aware that they may be conducting activities that fall within our jurisdiction.”
It didn’t take long after the ’s release for crypto lawyers to begin shredding any crypto industry euphoria.
Take these tweets from Preston Byrne, who lambasted it as a “legal…nothingburger[.]”
Anyway. tl;dr, the doc and the no-action letter are, legally speaking, nothingburgers. What these documents tell us is that the Commission understands the issues and is unlikely to be swayed by technobabble.
Structure accordingly.
— Preston Byrne (@prestonjbyrne)
Marco Santori was far more prolific in his tweeting about the release. He lamented:
“The promised guidance that would aid entrepreneurs in determining what are securities, then published guidance saying ‘If it makes sense to use a , it’s probably a security…’”
“Because the no-action letter and the framework each contain “no-transferability” caveats, I don’t immediately see how this advances the discussion or gives clarity to any entrepreneur who really needed it. Bummer.”
12/ The transferability prohibition seems as deeply-engrained in this analysis as the functionality requirement is. Transferability, specifically interoperability, is a touchstone of these networks – and the ERC-20 standard in particular.
— Marco Santori (@msantoriESQ)
Don’t Hold Your Breath Waiting for the SEC
CCN has continually on the being slow to address crypto-related issues. The best example is its failure to give a green light for the first (). Investors have been anxiously and patiently waiting for this to happen for years.
The recent announcement that it was on the hunt for a was seen as a smokescreen by many. CCN reported that it’s comforting to see the agency dedicating resources to the future of and . However, these developments have yet to result in any real progress toward regulatory clarity.
Crypto founder David Siegel recently CCN he blamed the for stymieing innovation by not moving on crypto-related issues.
He said:
“Building projects in crypto and is a lot like building projects in the regular business world. One of the biggest challenges we have is finding top coders. Cryptographers are easy to come by these days, but top-tier coders remain scarce.”
Read the ’s full DLT framework below:
by on Scribd
Published at Wed, 03 Apr 2019 22:17:18 +0000
