Trump's SEC May Change Cryptocurrency Regulation in the U.S.

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A major focus of the discussion is the controversial 2018 Hinman speech. The SEC's corporate finance division has prioritized condemning this speech. It has been criticized for causing confusion, particularly regarding the Howey test used to determine whether an asset qualifies as a security. This test has been misapplied to cryptocurrencies. Critics argue that this speech created unnecessary market chaos and a sense of favoritism. Essentially, it is seen as dividing the industry into 'winners' and 'losers,' which undermines transparency and fairness.

Addressing the legacy issues of such informal guidance is viewed as a crucial step. Instead, experts encourage the SEC to rely on clear, formal rule-making and no-action letters to provide a direct compliance pathway for crypto asset companies.

The meeting also outlined the Token Alliance's vision for the SEC under the presidency of Donald Trump. Trump's chosen SEC Chair, Paul Atkins, is seen as an experienced figure with a friendly attitude towards cryptocurrencies. Commissioners Peirce and Uyeda, known for criticizing the SEC's aggressive anti-crypto enforcement, may help lead this reform.

The Digital Chamber has put forth some bold initiatives for the first 90 days after the SEC's establishment. These include reviewing ongoing investigations, stopping cases without actual fraud, and withdrawing confusing guidance such as SAB 121. They have also proposed retracting a proposed amendment aimed at redefining 'exchange' to include decentralized finance (DeFi) protocols.

The Token Alliance is optimistic about the potential impact of the new SEC leadership. Improving the relationship between the SEC and the digital asset industry could pave the way for clearer crypto regulations in the U.S. This would encourage more innovation and stronger mutual trust. By focusing on fairness and transparency, this could ultimately become the new starting point the industry has been waiting for.

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