The American Securities and Exchange (dry) commission is officially washing the hands of the same.
The federal regulator of securities has declared that same – which he defined as a “type of cryptographic asset inspired by memes, characters, current events or trends for which the promoter seeks to attract an enthusiastic online community to buy the same and engage in his transaction” – are more like collection objects, according to a state of staff. of the dry business published Thursday. Because same has “a limited use or functionality”, they do not respond to the definition of security under the Howey test and are therefore outside the jurisdiction of the dry.
The declaration is a formalization of the comments made by Commissioner Hester Peirce – the recently created Crypto working group manager, who is at the forefront of the agency’s crypto regulation since his training in January – earlier this month during an interview with Bloomberg TV. In the interview, Peirce said that “many” of the same on the market do not fall under the jurisdiction of the dry.
“If people want to buy a token or a product that does not have a clear long-term value proposition, they should feel free but should not be surprised one day if the price drops,” Peirce wrote in his roadmap for cryptographic regulations published earlier this month. “In this country, people generally have the right to make decisions for themselves, but the counterpart of this wonderful American freedom is the American expectation just as wonderful as people must decide for themselves, not to turn to the mother government to tell them what to do or not do, or to bail them into when they do something that turns out to be bad.”
These legal interpretations of the securities regulator do not have the weight of formal regulations, but industries supervised by the SEC and other federal regulators tend to follow this type of personnel declarations closely. The infamous accounting bulletin n ° 121 – Advice known as SAB 121 which was offered by the agency’s accounting staff – caused trouble in the crypto sector and bankers who felt binded by it until the bulletin was erased by the current management of the SEC. In this case, a footnote in the declaration of the same personnel stresses that it is not “a rule, regulations, an orientation or a declaration” approved by the Commission.
Although Peirce has clearly indicated that American investors are responsible for their own reasonable diligence on the tokens they buy, the dry has not excluded the possibility of intervening and using its application powers in the event that the same is used to escape the securities.
“Notwithstanding the above, this declaration does not extend to the offer and sale of coins which are incompatible with the descriptions set out above, or products labeled” even “pieces” in order to escape the application of federal laws on securities by disguising a product that would otherwise constitute security, “said the declaration of staff. “As indicated above, the division will assess the economic realities of the particular transaction.”
