SEC Revises Treatment of Tokens as Securities
A representative of Robinhood, a major US investment app, testified at a hearing on the topic “The Future of Digital Assets” held by the US House of Representatives Committee on Agriculture on the 6th.
After the US Securities and Exchange Commission (SEC) filed a lawsuit against major cryptocurrency exchanges Binance and Coinbase, Robinhood decided to stop handling tokens that the SEC deemed to be unregistered securities. They say they are reviewing it.
The testimony was given by Dan Gallagher, a former SEC commissioner who is now Robinhood’s chief legal compliance officer. “We will review the SEC’s analysis method and determine any action that should be taken regarding currently listed tokens,” he said.
The SEC sued Binance on the 5th and Coinbase on the 6th. Among them, the following stocks were mainly regarded as marketable securities.
- Solana (SOL)
- Ada (ADA)
- Polygon (MATIC)
- The Sandbox (SAND)
- Chillies (CHZ)
- Cosmos (ATOM)
- dash (DASH)
- Algorand (ALGO)
- Binance Coin (BNB)
Of these, Robinhood is offering a platform to buy and sell tokens such as Solana, Ada, and Porygon.
Robinhood is registered with the SEC as a broker-dealer of securities. However, Gallagher said that tokens that the SEC considers to be securities cannot be treated as securities on the company’s platform any time soon.
“It would be impossible without large-scale deregulation and changes in the securities market,” he said.
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What is SEC
Established in 1934. Its purpose is to ensure fair trading and investor protection, and prevent insider trading, corporate fraudulent accounting, and market manipulation. It also determines whether virtual currency falls under the category of securities. SEC stands for “Securities and Exchange Commission”, and in Japan the “Securities and Exchanges Surveillance Commission” plays a similar role.
‘Action needed for regulatory clarity’
Gallagher also complained that Robinhood had been in talks with SEC staff for about 16 months to register as a special purpose broker-dealer before the SEC unilaterally terminated the process.
Regarding this point, Coinbase Chief Legal Officer Paul Grewal, who was sued by the SEC, also testified that they had been discussing registration with the SEC for months, but were suddenly abandoned and the lawsuit was filed. .
The hearing included Mr. Grewal and Mr. Gallagher as panelists, as well as former Commodity Futures Trading Commission (CFTC) chairman Rostin Behnham and former executives.
Panelists agree that current regulation needs to address shortcomings to protect consumers and foster innovation, and that Congress needs to act on this. .
Coinbase’s Grewal said the United States lacks clear rules and regulations despite the perceived importance of distributed ledger and cryptocurrency technology to the U.S. economy and national security. It pointed out.
On top of that, he appreciates the draft bill that was announced on the 2nd by Rep. Patrick McHenry and others, aiming to clarify cryptocurrency regulations.
connection: U.S. Congressmen announce bill to clarify cryptocurrency regulations