Regulation
Ex-SEC Official John Reed Stark to Testify on Crypto Enforcement

John Reed Stark, ex-head of the SEC’s Office of Internet Enforcement, is due to give testimony before the United States House of Representatives Financial Services Committee concerning the regulation of securities laws, particularly in the crypto market, on May 7th. Stark, who has an extensive securities law background, intends to illuminate the obstacles and needs of regulating the digital assets industry.
Stark argues that the SEC’s charges of overreach with “regulation by enforcement” are baseless, saying that what the critics call overreach is actually the SEC doing what it is supposed to do, which is to enforce the law.
SEC’s Approach to Crypto Regulation
In his prepared statement, Stark argues in favor of the current SEC regulatory position, underlining that the specifics of digital assets call for a strong regulatory approach to protect investors.
Stark asserts that the digital asset industry calls SEC Regulation by Enforcement simply enforcement. Thus, he highlights several high-profile crypto failures, such as FTX, that indicate the volatility and risks inherent in the crypto market. Stark argues that these kinds of cases are proof of the need for proper regulations to ensure the safety of investors and the dignity of the capital market.
Stark also provides a historical review of the SEC enforcement and states that the commission has continually changed its enforcement strategy to address new market technologies and concerns. His argument relies on the Howey Test, a standard set by a Supreme Court case in 1946 that has been used for years to determine what constitutes an investment contract in the context of U.S. securities law.
In addition, he believes that Howey Test principles are fully applicable to digital assets and refutes the assertion that the SEC has not given fair notice to the crypto industry.
Judicial Support for SEC’s Crypto Enforcement
The testimony stresses that federal courts have generally upheld the power of the SEC to consider digital assets as securities. Stark alludes to various court decisions where the judges supported the SEC’s actions against the crypto companies, making it clear that the SEC had provided adequate notice through its prior enforcement activities and public guidance. He refers to a judgment that the SEC’s position on crypto assets regulation aligns with the traditional securities law interpretations, providing required legal certainty and enforcement consistency.
In closing his speech, Stark recommends a tougher regulatory framework to address the precise risks digital assets pose. He also argues that they need to work together in creating rules, ensuring that any innovation is not hindered by heavy regulations while underpinning strong investor protection and market integrity.
At the same time, in a message on X, Stark expresses concerns over the current market of digital assets, which he calls a “post-apocalyptic anarchical free-for-all,” in which the majority of the cryptocurrency tokens’ intricacies are not thoroughly put under scrutiny and effectively communicated by those who push them forward.
Crypto Market Challenges and State Interventions
What is crucial to the narrative of Stark in the digital asset sector is that he argues that many in the crypto-verse are mistaken to think these assets do not need the sort of close supervision characteristic of traditional financial markets. He compares this situation to allowing unskilled people to perform complex surgeries, which is why many risks and irresponsibilities come from the lack of regulation.
Hmm, you are probably guessing right my friend — A sample of my thoughts this morning:
Let’s face it — most of the cryptoverse is not the Wild West, but more akin to a Walking Dead-like post-apocalyptic anarchical free-for-all. Promoters are marketing, and the investing public…
— John Reed Stark (@JohnReedStark) May 6, 2024
Additionally, Stark believes that with the SEC’s lack of active enforcement, the digital asset market will become a malpractice and fraud paradise, “drug dealers doing brain surgery.”
Therefore, Stark asserts that the activities in the cryptocurrency market trigger existing securities laws such as the ‘33 Act and the ‘34 Act- due to the nature of digital assets and their trading platforms.
He criticizes digital asset exchanges, brokers, and market makers because they employ terms that create the impression of the level of customer loyalty and protection, which is not true. Stark also says that this causes ‘pseudo masking of investment-related guarantees’ for investors, who have a wrong conception of the very nature of their investments and their inherent risks.
Read Also: Bitwise CIO Claims SEC Crackdown Is Favoring Coinbase
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Regulation
USDC Issuer Circle Set To File IPO In April, Here’s All

USDC issuer Circle is reportedly set to file its initial public offering (IPO) in April as part of the firm’s plans to finally go public. The stablecoin issuer is allegedly already working with top financial institutions to achieve this move.
Circle To File IPO In Late April
According to a Fortune report, Circle is looking to file its IPO in late April, although the listing period remains uncertain. The report noted that when a company files to go public, its shares usually begin trading four weeks later, indicating that the listing could occur in May. However, there is also a scenario where the IPO process could drag on for months.
The stablecoin issuer is reportedly working with investment banks JPMorgan Chase and Citi to achieve its long-anticipated IPO. The firm had previously tried to go public in 2021 under a SPAC arrangement with a shell company.
The US SEC failed to sign off on this arrangement back then, and the company eventually scrapped these IPO plans by the end of 2022 when the crypto exchange FTX collapsed and the broader crypto market experienced a downturn.
Revelation about Circle’s IPO plans comes just days after the stablecoin issuer partnered with NYSE’s parent company to explore USDC’s use in traditional finance (TradFi). Meanwhile, the USDC stablecoin recently launched in Japan following approval from the country’s regulator. Notably, USDC is the first and only global dollar stablecoin approved under Japan’s stablecoin framework.
An Easier Path Now For The Stablecoin Issuer
Circle will likely face less resistance for its IPO plans under the current SEC administration. Under acting Chair Mark Uyeda, the Commission has shown its willingness to work hand in hand with crypto firms, which was missing under Gary Gensler’s administration.
US SEC Chair nominee Paul Atkins has also shown his willingness to change the approach that Gensler’s administration adopted towards crypto firms. During his nomination hearing, the SEC Chair nominee promised to prioritize providing regulatory clarity for the industry.
Circle’s IPO listing would be the biggest since the top crypto exchange Coinbase went public in 2021. Interestingly, Coinbase owns an equity stake in the crypto firm.
The firm’s USDC is currently the second-largest stablecoin by market cap, only behind Tether’s USDT. The stablecoin industry is heating up as more financial institutions look to develop their own stablecoin.
Donald Trump’s World Liberty Financial recently revealed plans to launch its USD1 stablecoin, while asset manager Fidelity is also considering doing so.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Regulation
Japan Set To Classify Cryptocurrencies As Financial Products, Here’s All

Cryptocurrency investors in Japan are bracing for impact following a plan to reclassify digital assets as financial products. While the plan has elicited excitement from cryptocurrency enthusiasts in the Far East, the ambitious plan will have to scale several legislative hurdles.
Japan Targets Reclassification Of Cryptocurrencies As Financial Products
According to a report by Nikkei, Japan’s Financial Services Agency (FSA) is inching toward classifying cryptocurrencies as financial products. Per the report, the FSA intends to achieve the reclassification via an amendment to the Financial Instruments and Exchange Act.
Currently, digital assets in Japan are considered crypto assets conferred with property rights and seen as payment means. Under the FSA’s plans, cryptocurrencies in Japan will be treated as financial products in the same manner as traditional financial products.
The FSA says it will adopt a slow and steady approach toward the reclassification, carrying out “a private expert study group” to test the waters. If everything goes according to plan, the FSA will submit the amended bill to Parliament in early 2026.
The classification of cryptocurrencies as financial products will have far-reaching consequences for the local ecosystem. Experts say treating cryptocurrencies as financial products will bring Japan closer to a crypto ETF launch amid a changing regulatory landscape.
Furthermore, the move may lower current cryptocurrency taxation for local investors since existing capital market rules will apply to the asset class.
A Fresh Bill For Crypto Insider Trading Is Underway
Apart from the reclassification, the FSA disclosed plans for new legislation against insider trading. The move flows treating cryptocurrencies as financial products and will strengthen existing investor protection rules.
“It is a direction to establish a new insider trading regulation that prohibits trading based on unpublished internal information,” said the FSA. “We will develop laws to prevent unfair transactions.”
However, Japan’s cryptocurrency scene is heating up to a boil, driven by local and international players. Last week, stablecoin issuer Circle secured approval from the FSA for USDC with top exchanges set to list the stablecoin.
Japan’s Metaplanet has tapped Eric Trump to join its Strategic Board of Advisors as it continues to load up Bitcoin.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Regulation
Kentucky Governor Signs Off On ‘Bitcoin Rights’ Bill, Strengthening Crypto Protections


In what is being dubbed a major development in the crypto regulation space, the Governor of the US state of Kentucky, Andy Beshear, has signed the ‘Bitcoin Rights’ bill into law. The law promises to safeguard protections for Bitcoin (BTC) users.
Bitcoin Rights Bill Comes Into Effect
Crypto regulations continue to evolve under pro-crypto US President Donald Trump’s administration. In the latest development, Kentucky has become the newest state to enshrine protections for digital asset users.
In an X post published on March 24, crypto advocacy group Satoshi Action Fund announced that Governor Beshear had signed the much-anticipated Bitcoin Rights bill into law. The post stated:
The right to self-custody, run a node, and use of digital assets is now protected for millions of Americans without fear of discrimination.
The bill was first introduced to the Kentucky House by Rep. Adam Bowling on February 19. According to the bill’s description, it seeks to safeguard users’ rights to use digital assets and self-custody wallets. Additionally, it aims to prohibit local zoning changes that discriminate against crypto mining operations.
The legislation outlines guidelines for running a digital asset node and excludes digital asset mining from money transmitter license requirements. It also clarifies that crypto mining or staking is not considered an offer or sale of securities.
On February 28, the bill passed Kentucky’s House of Representatives with a unanimous vote of all 91 representatives in favor. It later passed the Kentucky Senate on March 13, receiving backing from all 37 senators.
Kentucky’s proactive stance toward cryptocurrencies isn’t new. Earlier this year, the state became the 16th US state to introduce legislation seeking to create a Bitcoin strategic reserve.
Meanwhile, neighboring state Arizona is also joining the crypto movement. A recent X post by Bitcoin Laws revealed that Arizona’s House Rules Committee has passed two Bitcoin reserve bills — SB1373 and SB1025. These bills will now head to a full floor vote.
Renewed Optimism Under Trump Administration
Following Trump’s victory in the November presidential election, cryptocurrency regulations in the US are evolving rapidly, with many states introducing legislation aimed at strengthening their digital asset ecosystems and attracting crypto businesses.
Positive changes in crypto regulations are encouraging industry businesses to expand. For instance, leading crypto trading platform Coinbase recently announced plans to hire 1,000 employees in the US.
The Trump administration has also witnessed several lawsuits being dropped against major crypto entities, including Kraken, Coinbase, Gemini, and others. At press time, Bitcoin trades at $87,399, down 0.2% in the past 24 hours.

Featured Image from Unsplash.com, chart from TradingView.com

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