The SEC is meeting this week for services and cryptocurrencies that crypto companies can offer to their clients. As Kriptokoin.com, we have compiled the details of the SEC’s meeting for cryptocurrencies for you.
SEC meets for cryptocurrencies
Citing “people familiar with the matter,” the securities regulator is working on a draft proposal that would make it harder for crypto companies to hold cryptocurrencies on behalf of their clients as “qualified guardians,” according to a February 14 report from Bloomberg.
This, in turn, could affect many hedge funds, private equity firms, and pension funds that work with such crypto companies. According to the reports, a five-member SEC panel will vote on February 15 whether the proposal moves to the next stage.
A majority vote (three-fifths) will be required before the rest of the SEC can officially vote on the proposal. If approved, the quotation will be modified with feedback as needed.
SEC may subject it to surprise audits
While the SEC has been discussing what it takes to become a qualified guardian of cryptocurrencies since March 2019, those familiar with the matter said it was unclear what specific changes the US financial watchdog was looking for.
Bloomberg explained that some crypto firms may have to move their customers’ cryptocurrencies elsewhere. The report added that these financial institutions may be subject to ‘surprise audits’ regarding their guardianship relationships or other outcomes.
https://twitter.com/GaryGensler/status/16234182677787227139
The news of Wednesday’s vote proposal comes after a report from Reuters on January 26 that suggested the SEC will soon follow Wall Street investment advisors on how they offer crypto custody to their clients.
Recently, the SEC has been dealing with Paxos Trust, the issuer of the Binance USD stablecoin, which they believe is issuing as an unregistered security.
It is claimed to be a security
The fact that the stablecoin Binance USD, issued by the Paxos Trust Company, is in the eyes of US regulators has sparked mixed reactions from the crypto community.
On February 13, the United States Securities and Exchange Commission (SEC) issued a well notice to Paxos, alleging that BUSD is an unregistered security. On the same day, the New York Department of Financial Services (NYDFS) ordered Paxos to cease issuing BUSD.
As Paxos faces regulatory scrutiny on several fronts, various members of the crypto community have taken to Twitter to address the situation. Members of the crypto community have come up with various theories on claims that BUSD is an unregistered security, from ignoring the issue as ‘FUD’ to calling it an attack on the Binance exchange.
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