In an interview with CNBC, Jay Clayton, the chairman of the SEC spoke about the status of the cryptocurrency market as securities. He also spoke about blockchain and Distributed Ledger Technology.
On the blockchain and DLT, he said that the technology held great promise. He also added that it can drive efficiency in the financial markets and in a lot of other markets.
He said cryptocurrencies that were created as a replacement for sovereign currencies or fiat, like Bitcoin [BTC] are not securities. He clarified the definition of a security, saying:
“A digital asset where I give you my money and you go off and make a venture, in return for me giving you my money…you say I’m going to get a return.”
He said that the SEC regulated offering of securities and that they regulate the trading of said securities. He said:
“Thats our job and we’ve been doing it for a long time. If its a security were regulating it. We’ve built a 19 trillion dollar economy on these rules…a securities market that’s the envy of the world.”
He further clarified that the definition of a security won’t be changed in response to the creation of the ICO market, stating that most ICOs are securities. He maintained the SEC’s position as a regulator in the market, saying that he would be glad to help companies that follow the SEC rules of private placement and trading.
When asked about the status of Ripple [XRP] and Ether [ETH] as securities, he said that he was not going to comment on whether they were securities or not as he did not want to mention specific crypto assets. He said:
“We are not going to do any violence to the traditional definition of a security, which has worked well for a long time…we’ve been doing this a long time, and there’s no need to change our fundamental approach.”
On a related note, Thomas Lee from Fundstrat spoke about regulation in the US cryptocurrency space. In a tweet, he said:
“I think we may be turning corner (positive) on US regulatory overhang. Why? I don’t believe @coinbase would announce Keystone and @circlepay would seek a bank unless they saw sufficient clarity to “run towards” regulation. Hence, positive for BTC.”
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