New Bitcoin Regulations to be expected; SEC Chair Confirms
The former chair of SEC, Jay Clayton hints about new regulations on Bitcoin. Clayton states that the new regulations will be applied directly or indirectly.
The former chair at the US Securities and Exchange Commission, Jay Clayton, has said that for the longest time, Bitcoin has not been classified as a security. Clayton appeared on an interview with CNBC News, where he stated that whilst Bitcoin was not classified as a security, it still needed to be regulated and this will be done via the new regulations that are to be expected in the recent days.
“Where digital assets land at the end of the day–will be driven in part by regulation both domestic and international, and I expect that regulation will come in this area both directly and indirectly,” says Former SEC Chairman Jay Clayton on #bitcoin. pic.twitter.com/voWcgCFqOH
— Squawk Box (@SquawkCNBC) April 1, 2021
Details of the Interview
The host of the show that was interviewing Clayton, Ross Sorkin pointed out the fact that the SEC was not regulating the use of Bitcoin. Clayton stated that the reason behind this was that Bitcoin was not yet classified as a security. By the time he was joining the SEC, the regulator did not have any jurisdiction over Bitcoin.
Clayton left the SEC in December 2020, but he has remained very relevant in the industry. Clayton is currently an adviser at River Asset management that deals with cryptocurrencies. He however stated that he did not have knowledge of what the new rules will be but he is sure that new regulations for Bitcoin were looming.
The former SEC chair also highlighted that the digital assets will be governed by regulations in both the domestic and international markets, to make them credible and viable. He later stated that the regulations in Bitcoin would be done both directly and indirectly. It can either be done through the way these bitcoin are held by banks, the security accounts involved, taxation measures and more. However, regardless of what the new rules will be, the regulations surrounding bitcoin will gradually evolve.
Jay Clayton’s comments come barely a few days after Ray Dalio, a hedge fund manager, stated that the US was in the verge of banning Bitcoin the same way that the US banned use of gold in the early 20th century.
Ripple also recently petitioned the SEC to provide documents that justify Bitcoin and Ethereum are not securities as the SEC rules state. Ripple has been locked in discussions with the SEC over Ripple’s XRP token. Ripple argues that XRP is not a security but the SEC states that its more centaralization makes it a security. The SEC is currently in a case with Ripple over their XRP token.