Former Securities and Exchange Commission Chairman Jay Clayton has spoken out about the need for the United States to keep pace with blockchain technology and tokenization.
The U.S. needs to act fast to maintain its advantage according to Jay Clayton who expressed his views in a commentary in the Wall Street Journal on Dec 16.
The former SEC chair said that the tokenization race is on, adding that the “nascent cryptocurrency market is the tip of the financial information technology iceberg.”
He added that many processes involving traditional finance “move at a snail’s pace in rigid sequences set decades ago.” These archaic and costly processes can be streamlined through tokenization providing enormous efficiency improvements, Clayton added.
Tokenization race with China
The former regulator confirmed that regulation of and tokenization assets is necessary but the government should not stifle innovation, saying:
The government should actively facilitate the adoption of technology in core U.S. dollar funding and payments markets.
These thoughts were echoed recently by Coinbase chief executive, Alesia Haas, who said that the crypto industry needs tailored regulations, not the same outmoded rules laid down for traditional finance.
Clayton went on to state that China is already racing ahead and embracing the technology to enhance yuan-based payments;
Chinese authorities are driving digitization and tokenization in their core payment and credit markets, allowing greater government monitoring and control.
Furthermore, he said that the U.S. already has a head start because 95% of stablecoins are currently pegged to the dollar. He warned that another nation seizing control of the global credit and payment system could destabilize the U.S. and global financial system.
Clayton concluded that time was of the essence and lawmakers should act quickly to ensure that America becomes the emerging standard. Citing the benefits of such a front-running move, he added:
Imagine the investment and human capital that would flow in the direction of U.S. ingenuity, virtually immediately, if such an effort were announced.
Crypto policy progress
Head of Policy at the Blockchain Association, Jake Chervinsky, commented that he couldn’t imagine a “clearer sign of our massive progress in the crypto policy debate” than the former SEC chair asset tokenization as “a once-in-a-generation opportunity for both entrepreneurs and nimble incumbents.”
The SEC, as it stands today, has been procrastinating all year as the queue of digital asset-based investment products awaiting approval lengthens by the week.
Disclaimer
All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
