Billionaire investor Mark Cuban has recently criticized the United States securities regulator for not providing a straightforward registration process for cryptocurrency companies.
The Shark Tank investor declared in a June 11 tweet that the United States Securities and Exchange Commission’s “Framework for ‘Investment Contract’ Analysis of Digital Assets” document does not contain any registration, making it “almost impossible” to determine what is a security in the crypto world.
Although no step-by-step instructions are included, the document does give a summary of the requirements for companies under U.S. federal securities laws.
It was necessary to reveal all data essential for investors to make “informed investment choices” and other “vital managerial efforts” that affect the prosperity of the enterprise.
Meanwhile, Cuban remarked that other areas of the finance industry are getting much more openness from the SEC. Instead of classifying “stock loans” as securities or taking legal action against brokers and banks, they are carrying out a “comment process,” Cuban stated.
He suggested that the same approach should be taken with cryptocurrency in order to discern which components of the currency are securities and which are not.
U.S. Senator Cynthia Lummis has also expressed her displeasure with the regulator for not establishing a “robust legal framework” or providing any kind of “legal guidance” for companies to follow.
At the Global Exchange & Fintech Conference on June 8, SEC Chair Gary Gensler asserted that there is a registration process in place and that firms are aware of how to register.
He spoke in reference to Coinbase and Robinhood’s assertion that they had attempted to register with the SEC, but their effort was denied.
The SEC has refrained from classifying digital assets in its latest hedge fund regulations.
On June 5 and 6, the SEC initiated legal action against Binance and Coinbase, respectively, claiming the exchanges had violated multiple securities regulations, particularly for offering digital currencies that the agency deemed to be unregistered securities.
The SEC has deemed a total of 68 cryptocurrencies to be securities.
Is SEC Chair Gary Gensler the ultimate authority on crypto regulation?
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