In his recent testimony before the Senate Committee on Banking, Housing, and Urban Affairs, Jay Clayton, chairman of the U.S. Securities and Exchange Commission, spoke about his agency’s direction and goals regarding regulation in the crypto space. Ever since cryptocurrencies ushered in a full-fledged industry, the SEC has maintained a stance that projects regulation with development and innovation in mind.
In his statement, Clayton reiterated that the SEC seeks to allow the industry to flourish while protecting investors from potential malpractice. Clayton explained that the FinTech ecosystem is undergoing constant change and progress, and that his agency is very much aware that dated policies shouldn’t hamper industry developments. Referring to this process as modernization, Clayton said that one of SEC’s primary goals is to create regulation that shields investors, but doesn’t constrict the growth of the crypto sector.
Clayton also directly addressed blockchain, stating that distributed ledger technology offers plenty of sensible investment opportunities for both institutional and individual investors. Regarding the SEC’s dealings, Clayton said that the company has done its best to regulate this industry in a way that makes room for both capital formation and innovation.
At the same time, Clayton stressed the need for proactive regulatory oversight that creates a safe space for crypto investment in the U.S. So far, the SEC has weeded out dubious or fraudulent ICOs as investment opportunities in the crypto space since they have expanded at a tremendous pace over the past couple of years. In recent months, the SEC has blocked and taken legal action against several high-profile ICOs that the company said failed to comply with its regulatory framework.
The SEC, however, went on to state that its reluctance to green light certain Bitcoin ETFs is merely a matter of maturity, as the token is still a very fresh asset in terms of widespread adoption. Furthermore, the SEC has opened the way for several new projects surrounding cryptocurrencies, including a blockchain-backed equity securities platform and the option to offer institutional investors shares of a fund that focuses on Bitcoin futures. Another notable approval came in the case of TurnKey Jet, a business-travel startup which aims to use tokens as a method of payment for its services.