A small company advocacy organisation is urging Congress in the United States to “clarify the status of digital assets.”
In May 2021, the United States Securities and Exchange Commission (SEC) held the 40th edition of its Annual Small Business Forum. The forum’s participants included the 5 SEC commissioners, 12 advocates of small businesses, 14 SEC staff members, 11 guest speakers, and a whopping 610 U.S. public members. All the participants urged the U.S. Congress to clarify digital asset status to make it crystal clear when digital assets are considered securities.
Why the group exactly sought regulatory framework changes isn’t exactly known. However, in response, the SEC clarified that the Howey Test is the current standard that helps to determine whether or not cryptocurrencies are securities. The response also included a citation of a published 2019 framework that the Strategic Hub for Innovation and Financial Technology had published (FinHub). The framework analyses the sales of digital assets to determine if they are transactions of securities.
The SEC asked crypto market participants to seek the FinHub staff’s advice if they are in doubt regarding the security status of digital assets. This latest development comes hot on the heels of SEC chairman Gary Gensler’s crypto stance. Gensler has time and again reached out to various crypto projects and platforms, calling them to engage in discussions with the SEC regarding crypto regulations. The SEC chair has said that if crypto players don’t approach the SEC, regulations may hit them hard and fast.
In August 2021, Gensler went public about his intention of introducing policy changes revolving around token offerings, custody, DeFi, stablecoins, lending platforms, and exchange-traded funds.