Republican Congressman Tom Emmer has commended the US Securities and Exchange Commission’s (SEC) clarification that Ether is not a security. Sales and offers of the native Ethereum cryptocurrency were defined by the SEC’s director of corporation finance William Hinman last week as not meeting the requirements to be classified as security transactions.
Avoiding over-regulation
Coin Desk discussed the SEC’s decision with Emmer, who has previously spoken out on the need to not overregulate blockchain and cryptocurrency industries in order to avoid stifling innovation.
Emmer noted that Ether was one of many blockchain-related innovations that does not fit well into ”the regulatory boxes Washington has created”. He found Hinman’s comments ”encouraging, specifically his suggestion that the decentralized and useful nature of certain technologies may provide a means toward regulatory certainty”.
This may be true, he commented, even for assets previously considered securities. While Emmer summarized the SEC’s actions as a ”light-touch approach”, he said that he was hopeful regulators would pursue further steps to limit regulation in order to encourage US investment.
As the Ethereum ecosystem has been constructed around its blockchain and smart contacts platform, many considered the prospect of a security classification as bringing the network serious challenges.
This sentiment has been supported by the acting director of the Consumer Financial Protection Bureau Mick Mulvaney. Speaking at the Future of Fintech conference Wednesday, Mulvaney he shared his concerns that over-regulation would ”discourage people from entering the marketplace”.
Speaking directly on Bitcoin regulations, Mulvaney said: ”We knew at an early point in Bitcoin that, as with any developing financial technology, we needed to find that sweet spot.”
Protecting consumers is undoubtedly a priority as he commented, although some laws, when applied to the financial technology sector, will create an “absurd result”. Mulvaney considers it his task to both identify and prevent this from occurring.
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