While enforcement actions have been a focus for the US SEC in the crypto industry lately, some crypto exchanges are now making efforts to expand into other territories.
The United States Securities and Exchange Commission (SEC) has taken a step backward by withdrawing from its decision to classify digital assets. The regulator achieved this by removing the first official definition of “digital asset” from its most recent household hedge withdrawal regulations.
Notably, the SEC first included the definition in its 2022 plan to alter mandated disclosures for hedge funds, but it was removed in the final rule authorized by the commissioners.
While commenting on the matter, Anne-Marie Kelley, a former SEC official stated that the SEC’s decision may have been influenced by concerns that it would be harder to argue in court that digital assets are securities. Despite the agency’s decision, it is undoubtedly still interested in crypto-related issues. Remarkably, this has played a significant role in both its enforcement actions and ongoing rule proposals.
For instance, the regulator has announced plans to increase its crypto investigation and enforcement staff. The newly formed staff roles, according to the SEC, would include trial attorneys, investigators, and fraud analysts.
Additionally, the securities regulator underlined five major areas of concentration on which they would concentrate their efforts. This includes cryptocurrency exchanges, DeFi projects, lending and staking services, NFTs, and stablecoins.
The SEC Clamps Down on Enforcement
While the SEC’s approach to cryptocurrency regulation is complex and developing, many industry observers believe that the regulator has recently prioritized enforcement actions over establishing clear crypto guidelines.
In April, the regulator filed a lawsuit against Seattle-based crypto exchange Bittrex over allegations of violating Federal laws. In a press release, the SEC accused Bittrex of collaborating with cryptocurrency issuers to “delete problematic statements” in order to dodge regulatory scrutiny.
Interestingly, Bittrex received the lawsuit shortly after requesting clarification from the SEC on which digital assets on its platform constitute a security.
Similarly, Robinhood Markets received an investigative subpoena from the SEC for the company’s crypto operations. According to the details, the subpoena mentions a variety of topics, including cryptocurrency listings, cryptocurrency custody, and platform operations.
While enforcement actions have been a focus for the US SEC in the crypto industry lately, some crypto exchanges are now making efforts to expand into other territories.
For instance, cryptocurrency exchange Coinbase has created an international exchange to provide an expanded spectrum of crypto services to its thronging institutional clients. The new Coinbase International Exchange, according to the business description, provides contracts for Bitcoin (BTC) and Ether (ETH) perpetual futures.
The company promises that the international exchange offers secure customer protection, high-performance trading technology, and a strong risk management framework to protect clients. Overall, the SEC’s strategy for policing crypto is complex, and it will probably keep changing as blockchain technology and industry advance.
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