Hester Peirce, SEC Commissioner, recently made a strong statement that "tokenized securities are still securities," asserting that blockchain does not change the legal nature of assets. This is aimed directly at companies wanting to move traditional stocks onto blockchain to evade regulation.
Concerns about legal loopholes
This statement comes in the context of Senator Elizabeth Warren also expressing serious concerns about the CLARITY Act (which is being pushed by the House during "Crypto Week"). Ms. Warren believes this bill could create a "huge legal loophole" for large companies like Meta or Tesla to move their stocks onto blockchain to evade oversight by #SEC , threatening existing investor protection measures.
The CLARITY Act is a legal framework aimed at redefining the regulatory roles of digital assets between the SEC and CFTC, with the SEC overseeing securities and the CFTC supervising digital commodities. The bill also introduces the concept of "mature blockchain" and "digital commodities" so that some decentralized tokens can escape the SEC's jurisdiction, and provides an exemption from registration for token issuance under $75 million if it complies with disclosure obligations.
However, experts warn that this could inadvertently become a legal gray area, where large companies circumvent the law to avoid the SEC's stringent registration process. James Seyffart of Bloomberg Intelligence remarked that this is a reminder that the SEC may be more open to crypto, but not in a way that ignores securities laws.
"Crypto Week" and important bills
The U.S. House of Representatives has chosen the week of July 14 to 18 as "Crypto Week" to review and pass three important bills:
GENIUS Act: The bill regulating stablecoins, which has been passed by the Senate.
#CLARITYAct : The bill redefines the regulatory boundary for the digital asset market between the SEC and CFTC, soon to be voted on by the House.
Anti-CBDC Act: The bill to "kill" CBDC.
Major organizations in the crypto industry such as Coinbase and OpenSea strongly support the CLARITY Act, arguing that this bill will help the U.S. not fall behind in the global blockchain race. On the contrary, the opposing side, including Warren and Representative Maxine Waters, argues that the bill is too rushed, complex, and dangerous, and could legalize evasive actions against regulation.