The Securities and Exchange Commission announced a new crypto task force dedicated to developing a clear regulatory framework, marking a shift from the previous enforcement-focused approach to digital assets.
The initiative, announced by SEC Acting Chairman Mark T. Ueda and led by Commissioner Hester Peirce, comes as fund issuers await clearer guidelines on launching investment products. , which could reshape the way companies approach the provision of digital assets after years of regulatory uncertainty.
The task force will work with various divisions of the SEC, other federal agencies, and the public to establish a prudent regulatory path, the SEC said in a statement. Under Peirce’s leadership, the group aims to provide a realistic pathway to registration and create a sensible disclosure framework.
“One of the task force’s directives is to create a clear path to registration for crypto market participants,” Amy Lynch, founder and president of strategic consulting firm Frontline, said in an email. told .com. “The current path already exists, but there is a lot of room for improvement in the process.”
Lynch said the task force aims to address custody regulations that have historically hindered innovation in crypto products. “Current custody rules do not take into account cryptocurrencies or digital assets,” she said.
The proposed custodial rules starting in 2023 attempted to address digital assets, but they “fall far short of what the market needs,” Lynch noted. The task force may revise these requirements through the SEC’s Division of Investment Management.
As the framework evolves, coordination between regulators will play an important role. “In particular, coordination with the (Commodity Futures Trading Commission) will be necessary if the definition of a security is updated to clarify when a virtual currency is a security and when it is a commodity.” explained Lynch.
Regulatory changes will take time, but Lynch suggests the initiative will bring new opportunities. He added: “The floodgates are now open and more digital asset ETFs will hit the market next year, so now is the time for funds to submit their applications.”
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