Regulation
House Hearing Challenges SEC’s New Equity Rules, Here’s Why
The House Financial Services Subcommittee on Capital Markets, under the leadership of Chairman Ann Wagner (MO-02), held a hearing titled “Solutions in Search of a Problem: Chair Gensler’s Equity Market Structure Reforms.”
The session focused on the equity market structure reforms proposed by SEC Chair Gary Gensler, which aim to overhaul the current structure of American equity markets.
House Hearing Challenges SEC’s New Equity Rules
The chairman of the commission, Wagner, noted that there is no clear understanding of the market issues that the proposed reforms address and how they will help market participants.
Wagner pointed out that the U. S. capital markets are already very liquid and competitive, pointing out that 12 billion shares are traded in American stock markets daily. She pointed out that retail trading has increased since the zero-commission trading was introduced in 2019 and is estimated to constitute between 10-20% of the trading volume in the U.S.
This afternoon, I heard firsthand from market participants how the @SECGov‘s equity market structure rules will disrupt our capital markets, likely at the expense of everyday investors. The SEC needs modern market data before acting, and I heard that loud and clear today. pic.twitter.com/InJJ67gWxF
— Congressman Dan Meuser (@RepMeuser) June 27, 2024
Subsequently, Wagner opposed the SEC for promoting these reforms without sufficient economic analysis and justification. She argued that the SEC’s own economic analyses acknowledged that the impacts of the proposals were “unquantifiable.” In addition, she raised concerns about the use of old and unreliable data, including data from Rule 605 reports, which the SEC staff admitted were not very useful.
The hearing focused on five key equity market structure proposals that the SEC has introduced in less than a year. In March 2024, the SEC approved one proposal which is related to the changes in Rule 605 concerning the enhancement of the order execution data.
According to Wagner, this enhanced information should have been analyzed to see whether there was a need for embarking on other reforms prior to presenting the remaining proposals.
Calls for Prudent Regulatory Actions
Wagner suggested that the SEC should slow down and focus more on implementing effective rules for which there is sufficient evidence pointing to their necessity and on conducting proper cost-benefit analysis.
She said that millions of Americans rely on the US equities markets for their financial concerns and that such a system should not be altered in a way that would jeopardize the stability of the market.
Testimonies at the hearing aligned with Wagner’s worries where they stated that the proposed changes may harm the retail investors. They underlined the need to preserve the conditions that have attracted competition and efficiency with minimal interference.
Supreme Court Decision on SEC’s Enforcement Powers
Concurrently, the Supreme Court has recently decided that defendants in SEC fraud cases have a right to a jury trial in federal court, which means that the SEC cannot prosecute some complaints internally. This decision impacts the SEC’s enforcement strategy because civil fraud cases have to be heard in federal courts, which may change the way the SEC deals with such cases.
The Supreme Court’s decision may influence other regulatory agencies and may be a sign of the ongoing tendency to constrain the authority of federal regulators.
This ruling comes after a number of court decisions that have limited the authority of federal agencies, and including environmental ones. The SEC had already started reducing the in-house cases even before the ruling and the recent decision will define its future enforcement strategies.
Read Also: Ripple CLO Spotlights SEC’s Setback In Proxy Advisory Firms Rule
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
UK to unveil crypto and stablecoin regulatory framework early next year
- The UK will introduce unified crypto regulations, including stablecoins, in early 2025.
- New rules aim to simplify oversight and avoid restrictive staking classifications.
- Labour government aims to compete with EU’s MiCA rules and US pro-crypto policies.
The United Kingdom is set to introduce a comprehensive regulatory framework for cryptocurrencies, stablecoins, and crypto staking services in early 2025, marking a pivotal shift in its approach to digital assets.
The announcement was made by the Economic Secretary to the Treasury Tulip Siddiq at City & Financial Global’s Tokenisation Summit in London on November 21.
Initially slated for December 2024, the regulatory rollout was delayed due to the change in government following the election of Prime Minister Keir Starmer’s Labour administration in July 2024.
The upcoming UK crypto regulatory framework
The upcoming framework consolidates regulations for crypto assets into a single, overarching regime, a decision Siddiq described as “simpler and more logical.”
The framework aims to provide clarity in a rapidly growing sector that has faced uncertainty in the UK.
Stablecoins will receive distinct treatment under these regulations, as their functionality does not align with existing payment services rules.
Siddiq highlighted that staking services would also avoid being designated as “collective investment schemes,” a classification that could impose burdensome restrictions.
UK aims to align with the global crypto regulatory landscape
The UK government’s renewed focus on digital asset regulation comes as it seeks to align with global developments. The European Union’s Markets in Crypto-Assets (MiCA) regulations will be fully enforced by the end of 2024, offering regulatory certainty that has positioned Europe as an attractive market for the crypto industry.
Meanwhile, the US, under President Donald Trump’s administration, has adopted a markedly pro-crypto stance, including the establishment of a White House “crypto czar” and SEC Chair Gary Gensler’s planned departure in January 2024.
The Labour government has shown its intent to catch up with international competition. In September 2024, it introduced a bill recognizing NFTs, cryptocurrencies, and carbon credits as property.
The new regulatory push reflects the UK’s ambition to regain credibility as a crypto hub while addressing criticisms of the Financial Conduct Authority’s perceived stringent oversight.
By delivering a robust, streamlined framework, the Labour government aims to bolster the UK’s standing in the multibillion-dollar crypto industry.
Regulation
Gary Gensler To Step Down As US SEC Chair In January
In a recent development, the US Securities and Exchange Commission (SEC) announced that Gary Gensler will step down from his position next year. This follows calls for Gensler to resign since Donald Trump won the US presidential elections.
Gary Gensler To Step Down As US SEC Chair
The US SEC announced in a press release that Gary Gensler will depart the Agency on January 20, 2025. The US SEC Chair also confirmed this development in an X post. Interestingly, this comes on the same day that Donald Trump will be inaugurated as the 47th president of the United States.
Following the announcement, Gensler also used the opportunity to reflect on his time at the Commission. He remarked that it has been an “honor of a lifetime” to serve alongside those at the SEC. He also thanked President Biden for the opportunity to serve in the position. Gensler has been the US SEC Chair since April 2021. During his time, he has spearheaded several litigations against the crypto industry.
This includes the long-running legal battle with Ripple, which Gensler took over from his predecessor Jay Clayton, which bordered on whether XRP was a security. Up till now, the Agency continues to reiterate this ‘digital asset securities’ claim.
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
BitClave Investors Get $4.6M Back In US SEC Settlement Distribution
BitClave investors have started receiving $4.6 million in repayments from the U.S. Securities and Exchange Commission (SEC), following a settlement reached in 2020. The SEC announced on Nov. 20 that payments from the BitClave Fair Fund had been disbursed to eligible investors harmed during the company’s 2017 initial coin offering (ICO).
Pro-XRP lawyer and online commentator “MetaLawMan” criticized the SEC’s stance on digital assets, stating on social media, “Here we go again with ‘digital asset securities.’ Unbelievable.” The lawyer’s statement reflects ongoing industry frustrations over the SEC’s regulatory approach to cryptocurrencies.
BitClave Investors Get $4.6M Back in US SEC Settlement
The US SEC assured the public that $4.6 million was returned to investors who filed the claims and were eligible for the refunds. These funds were agreed upon in 2020 after the SEC accused BitClave of conducting an unregistered ICO.
The company’s initial coin offering (ICO) in 2017 brought in $25.5 million in only 32 seconds and distributed its Consumer Activity Token (CAT) to thousands of buyers. The SEC therefore claimed that the ICO was an unregistered securities transaction because potential investors were induced to invest in the CAT token with an expectation of appreciation of its value.
Under the settlement, BitClave will have to refund the money it raised and also pay $4 million in fines and interest. In between these settlements, John Deaton has accused the regulator of using laws that were set in 1933.
The Fair Fund was therefore created to ensure that the funds are returned to the affected investors. The claims submission period closed in August 2023, and the eligible investors received the information on the claims in March 2024. The Securities and Exchange Commission posted on its social media accounts that the payment has been made, and “the checks are in the mail.”
BitClave Settlement Included Penalties and Token Destruction
In the settlement, BitClave did not accept or reject the accusations made by the SEC but agreed to cough up $29 million. This total consisted of the $25.5 million that was generated in the ICO and the additional $4 million in fines.
Concurrently, the company also committed to burning 1 billion of the catalyst tokens that have not been distributed and to ask exchanges to delist the token.
The Securities and Exchange Commission therefore pointed out that by February 2023, BitClave had only remitted $12m to the Fair Fund, thus leaving questions on the balance of $7.4m. Neither the SEC nor the fund administrator gave further details on the matter, and it is still uncertain as to how the outstanding payment will be collected.
US SEC Maintains Strict Regulatory Stance on Crypto
The US SEC has continued to enforce regulations on crypto companies under the Biden administration, with over 100 enforcement actions taken against the industry. BitClave’s settlement, subsequently, is one of many cases where the regulator has targeted unregistered ICOs and other alleged securities violations.
BitClave’s case, handled under former SEC Chairman Jay Clayton, emphasized the agency’s view that many digital assets fall under securities laws. The CAT white paper described potential value increases, which the regulator argued encouraged speculative investment in an unregistered security.
As the US SEC faces criticism, President-elect Donald Trump has expressed plans to reshape crypto oversight. Trump has promised to remove current SEC Chair Gary Gensler and is reportedly considering creating a new White House position dedicated to cryptocurrency policy.
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.
-
Market19 hours ago
This is Why MoonPay Shattered Solana Transaction Records
-
Ethereum16 hours ago
Fundraising platform JustGiving accepts over 60 cryptocurrencies including Bitcoin, Ethereum
-
Regulation23 hours ago
BitClave Investors Get $4.6M Back In US SEC Settlement Distribution
-
Market22 hours ago
Nvidia Q3 Revenue Soars 95% to $35.1B, Beats Estimates
-
Market21 hours ago
Dogecoin (DOGE) Price Momentum Weakens Despite Rally
-
Altcoin21 hours ago
Crypto Analyst Says Dogecoin Price Has Entered Parabolic Surge To $23.36. Here Are The Reasons Why
-
Market20 hours ago
Steady Climb Toward New Highs
-
Market24 hours ago
RENDER Price Soars 48%, But Whale Activity Declines
✓ Share: