Bitcoin is “not a security” and the Securities and Exchange Commission (SEC) will not change the definition of a security for the benefit of cryptocurrencies, according to SEC chairman, Jay Clayton.
Clayton said in an interview that the SEC was “not going to do any violence to the traditional definition of ‘security’ that has worked for a long time”.
He also said that the SEC would not change its rules for initial coin offerings, underscoring that tokens or digital assets used in that fundraising process are securities.
Nigel Green, founder and CEO of deVere Group said that this was evidence of the cryptocurrency sector becoming “increasingly mainstream”.
He added that the SEC was giving a “steadfast yet proactive approach on bitcoin and other cryptocurrencies”.
“The SEC is right to insist that the digital coins, such as bitcoin, which are replacement for sovereign currencies, such as the dollar, sterling, yen and euro, are not securities. Similarly, I believe the SEC is also right that the tokens—which [Clayton] did not name—that act as digital assets are securities.”
“This clarification by the SEC removes some of the uncertainty that has been swirling around the crypto sector and serves to strengthen the overall proposition of many of the major cryptocurrencies.”
Green concluded: “The SEC’s invaluable and far-sighted work in this area once again highlights how many governments, central banks, and regulators around the world are all now recognising the scale and potential of Bitcoin and other cryptocurrencies.”
“The SEC’s clarity will have a positive impact on the cryptocurrency sector. The agency’s stance will rightly target what needs to be targeted and allow the legitimate digital coins to prosper.”
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