I am honored to be nominated by President Trump to serve as the 16th Chairman of the U.S. Commodity Futures Trading Commission. With the President’s leadership, a Great Golden Age for America’s Financial Markets and a Wealth of New Opportunities stand before us. I pledge to work President Trump has made an excellent choice in Mike Selig to lead the @CFTC . As anyone who knows him will attest, @michaelselig is deeply knowledgeable about financial markets and passionate about modernizing our regulatory approach in order to maintain America’s
SEC Chair Gensler suggests his departure from the agency may be imminent in remarking today that “it’s been a great honor to serve.” Whether Gensler departs or not, President Trump will designate a new Chair or Acting Chair on January 20.
Continue to hear commentators saying Judge Torres held that XRP is a security when sold to institutions and not a security when sold to retail. This is incorrect. Judge Torres held that XRP itself is not a security, but it can be sold as part of a security. /1
SEC characterizes Kraken's custodial staking product as a security. Focus is on the fact that Kraken allegedly pooled customer crypto to provide superior and more consistent yield relative to non-custodial staking options. SEC view is not that staking in itself is a security.
Judge Rakoff’s decision on Terraform’s motion to dismiss in SEC v. Terraform Labs isn’t exactly the win the SEC wanted. Judge Rakoff agreed with Judge Torres that crypto assets, in and of themselves, are not investment contracts. Bad for the SEC. /1
Significant setback for SEC w/ Judge Failla granting Coinbase’s motion to dismiss SEC’s claim that Coinbase acted as a broker by offering non-custodial digital wallet software. SEC aimed to discourage builders from developing peer-to-peer software. Didn’t work.
Gensler is out. Dealer rule is struck down. SAB121, safeguarding proposal, exchange definition proposal and anti-crypto lawsuits are DOA. Clear path for a new administration to develop a pro-crypto regulatory framework and make America the crypto capital of the planet.
Don’t sleep on the SEC’s action against Do Kwon and TFL. The complaint includes a ton of novel legal theories that can be applied to stablecoins, wrapped tokens, liquidity pool tokens and other crypto assets. Steady lads… /1
SEC critique of Ripple for creating distinct standards for retail & institutional investors shouldn’t persuade any court. Howey’s a facts/circumstances test. Judge Torres distinguished transactions (not investor classes) bc facts (sales tactics, marketing, contracts) required it.
Banking regulators have essentially said banks can only issue stablecoins on private blockchains. PayPal will issue its stablecoin on Ethereum. This regulatory arbitrage has to put pressure on Congress to pass a stablecoin bill ASAP.
ETH has a broadly decentralized value proposition. Millions of apps, developers, and tokens on Ethereum. NYAG’s arg that ETH is a security bc holders expect profits from the efforts of Ethereum devs and founders to promote ETH for investment and transition to PoS is nonsensical. Crypto assets are network assets. Unlike firms, networks are generative. Value derives from the apps, organizations and projects built on the network. Once a network is sufficiently decentralized, its value isn't dependent on any central actor and securities laws shouldn't apply.
Seems unlikely SEC wants to regulate crypto exchanges, brokers and clearing agencies and more likely it wants to make it impossible for them to operate in the US. SEC is targeting the biggest US intermediaries - Coinbase, Kraken, Bittrex and Gemini. If they can’t comply, who can?
Massive win by the Ripple team against the SEC. Judge Torres clearly affirms the view that the same crypto asset may be sold as an investment contract (and therefore a security) and as a standalone good. The investment contract is the security, not the crypto asset. /1
SEC complaint against TFL and Do Kwon alleges that LUNA and UST are securities. In a novel theory, the SEC not only characterizes UST as an investment contract but as a security bc it could be exchanged for a security (LUNA). Under this theory, nearly anything can be a security.
