Former SEC Chairman Says Crypto Fits Existing Legal Framework

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In Brief
  • Former head of the SEC, Jay Clayton says crypto is in line with the current laws.

  • Clayton joins advisory board of crypto unicorn.

  • He believes taxation of the industry is “a good thing”

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According to a recent email exchange, ex-SEC Chairman Jay Clayton sees the existing U.S. regulations as a good model for crypto rules. 

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Jay Clayton spent a few years as the chairman for the U.S. Securities and Exchange Commission, which Gary Gensler now heads. In light of the recent bipartisan bill passed by the Senate, crypto regulations are the industry’s hot topic. 

If the wording in the bill is left as-is after its hearing in the House, this could mean a major disruption to the crypto space. When asked about regulations on the industry, the former SEC head said taxation clarity is a good thing. 

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“Clarity around the taxation of digital assets is a good thing. A good place to start for that clarity is what function are those assets providing and should they be taxed like other assets that are providing that function.”

However, Clayton added,

“New technology should not cause us to change the fundamental protections in our securities and other financial markets. To the extent that a digital asset is a store of value, I would think about taxing it the same way you tax the purchase or sale of a similar store of value like, for example, gold.”

Nonetheless, the current SEC chairman doesn’t hold the same sentiments. Gensler has been contemplating a more robust oversight regime toward crypto. In addition, he called upon the likes of Senator Elizabeth Warren for regulatory support. Warren is a stickler for more tightening regulations and implementing “crypto cops.”

Regulators for crypto

The former SEC chairman is also venturing into crypto as a part of the advisory board for Fireblocks. 

Fireblocks specializes in digital assets for payments, crypto gaming, and NFTs. This addition to the Fireblocks board comes after a successful Series D funding round. During that round in which the company raised $310 million.

CEO and co-founder of Fireblocks, Michael Shaulov, said Clayton’s high-level experience will be helpful as new regulations surface. “Jay’s insights on market practices and regulations in finance will help our customers understand how these new digital solutions and investment opportunities best fit within regulatory objectives as well as the incumbent technology.”

In addition, the former Commissioner of the Commodity Futures Trading Commission released a statement of his end of term and future plans. In the statement, the former U.S. official believes crypto innovation is a priority.

“I look forward to keeping innovation, particularly related to crypto and DeFi, relevant to my career and will continue advocating for the freedom, innovation, inclusion, and prosperity they offer.”

Some regulators want to see the space tightened up under more stringent regulations, while others understand that the situation needs to be handled delicately.

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Savannah Fortis is a multimedia journalist covering stories at the intersection culture, international relations, and technology. Through her travels she was introduced to the crypto-community back in 2017 and has been interacting with the space since.

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