PaymentsSource: The SEC’s Crypto Moves Are at Odds With Its Own Mission

O’Melveny counsel Bill Martin authored the article “The SEC’s Crypto Moves Are at Odds With Its Own Mission” for PaymentsSource. Martin, a former senior counsel in the Securities and Exchange Commission’s Market Abuse Unit, discusses how the SEC’s recent focus on cryptocurrencies and exchange platforms may be stifling innovation and capital formation in the US. 

“The Securities and Exchange Commission and other state and federal regulators have increasingly focused their attention on cryptocurrencies and the exchange platforms on which such digital assets trade,” Martin writes. “While such attention may be warranted in light of the strong growth characterizing this still nascent industry, the SEC’s efforts may have begun to run counter to the SEC chairman’s priority to foster greater innovation and capital formation in the U.S. A central question for the digital assets industry has long been the circumstances in which the SEC would consider a particular token or coin to be a security. If such an asset is a security, the securities laws require that it be registered with the SEC unless a statutory exemption applies. In addition, exchanges or other platforms where unregistered securities may be trading risk their own exposure to SEC scrutiny.”

Read the full article here.