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SEC Chairman: Cryptocurrencies Like Bitcoin Aren’t a Security But Tokens Are

Jay Clayton | Securities Exchange Commission US | Bitcoin | SEC Bitcoin as Security | Bitcoin updates | Cryptocurrency updates

 

Jay Clayton, the chair of the US Securities and Exchange Commission (SEC), believes that Bitcoin (BTC) is not a security since it acts as a replacement for sovereign currencies.

According to the CNBC reports on June 6, Jay Clayton told,

“We are not going to do any violence to the traditional definition of a security that has worked for a long time. We’ve been doing this a long time, there’s no need to change the definition.”

Clayton, when speaking about the “incredible promise” of distributed ledger technologies driving efficiencies in markets, clarified during today’s CNBC interview his thoughts on cryptocurrencies that are “replacements for sovereign currencies:”

“Replace the dollar, the yen, the euro with Bitcoin. That type of currency is not a security.”

Clayton did not particularly pass his on specific assets besides Bitcoin about their status as securities, but he did mentioned what he considers to be securities are tokens that act as digital assets:

“Where I give you my money and you go off and make a venture […] and in return for me giving you my money, you say, ‘You know what, I’m going to give you a return.’ That is a security, and we regulate that. We regulate the offering of that security, and we regulate the trading of that security.”

When asked to make it more clear to the audience whether Initial Coin Offerings (ICO) are securities, Clayton told the interviewers, CNBC’s Bob Pisani, “Bob, I just did.”

Clayton firmly told that SEC doesn’t believe in changing the definition of a security to support the ICO community, as they are not “going to do any violence to the traditional definition of a security which has worked well for a long time.”

The SEC chair had previously praised distributed ledger tech, blockchain as an example, during February’s SEC and Commodity Futures Trading Commission (CFTC) cryptocurrency hearing. At the time, Clayton had noted that every ICO that the SEC had seen so far would be considered a security.

But companies tied to those cryptocurrencies have argued that some should be fall under a different category, in many cases because of their utility.

The financial watchdog has been balancing consumer protection and innovation in what has become multi-billion dollar cryptocurrency market. The market capitalization of bitcoin alone is more than $130 billion, according to CoinMarketCap.

KryptoMoney.com publishes latest news and updates about Bitcoin, Blockchain Technology ,Cryptocurrencies and upcoming ICO’s.

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