The Ice Is Melting: SEC Is Open For Cryptocurrency Innovations

While the US Securities and Exchange Commission is known for its cautious stance on cryptocurrencies, it seems things have been changing. The watchdog’s Chairman claimed that they are open to Decentralized innovations.

During a webinar with the Chamber of Digital Commerce, the SEC Head, Jay Clayton, stated that they are open to adopting innovations in the decentralized finance space. However, he also noted that they are not going to abandon their adherence to the principles of security and transparency. He told during the webinar:

“We're willing to try that; our door is wide open. If you want to show how to tokenize the ETF product in a way that adds efficiency, we want to meet with you, we want to facilitate that.”

Still cautious

Nevertheless, such a claim doesn’t mean the watchdog is going to accept an ETF proposal right away. According to Jay Clayton, they are willing to approve and test a proposal that is solid and reliable enough. However, he has never announced any particular requirements concerning a proposal they would approve.

As CoinIdol, a world blockchain news outlet, previously reported, the SEC has turned down numerous crypto ETF proposals. It is obvious that the watchdog is not going to give up its requirements to security and quality of solutions that are to be approved. Nevertheless, as its Chairman expressed support for innovation, there is a hope the situation might change. 

Previously, there was only Hester Pierce, also known as the Crypto Mom, who stood for adopting innovations. She has been trying to lobby the adoption of Crypto ETFs, however, with little luck. Now, with the support of the SEC Chairman, the efforts might become more fruitful.

Favouring blockchain

Meanwhile, the regulator is working on developing a proper framework for monitoring and tracking digital assets. As the digital finance industry is innovative, its regulation requires innovative solutions as well.

For this reason, the SEC has adopted a blockchain forensics tool in early August 2020. The tool is aimed at tracking the distribution of funds generated through token sales. For now, it facilitates risk monitoring and compliance.

From all the above it is obvious that the US financial watchdog is not that conservative as it may seem. However, since they take the protection of the citizens as a priority, they are likely to check all new solutions and proposals very thoroughly before the adoption. So it is still unclear whether the crypto community is going to see the approval of any crypto ETF any time soon.