Chair

Test

Gary

U.S. Securities and Exchange Commission (SEC) on Friday announced that it denied a Petition for Rulemaking filed on behalf of Coinbase Global. <a href="https://news.todayq.com/sec-chair-drops-hints-over-spot-bitcoin-etf-decision/" target="_blank" rel="noopener noreferrer nofollow">US SEC chief</a> states three reasons to support the commission’s decision. However, it will be interesting to see Coinbase’s next move after a big refusal. SEC Chief states three reasons for denial 
As perthe statement, US SEC chair Gary Gensler highlighted three key reasons for the decision. The first reason is existing laws and regulations apply to the crypto securities markets. The second reason is that the commission also addresses the crypto securities markets through rulemaking. The third reason suggests that it is important to maintain the watchdog’s discretion in setting its rulemaking priorities. 
Gensler’s statement took the first rationale stating that the laws and regulations governing securities already apply to crypto securities markets. He went on to argue that there is no basis to consider crypto securities as exempt from the protections afforded by existing securities laws.
However, the US SEC Chair drew on historical context by pointing out that Congress is enacting securities laws. This intentionally casts a wide net including a diverse range of financial instruments under the definition of a security. Such as the broad category of “investment contract.” Howey Test still crucial 
Gensler mentioned the SEC’s reliance on the “Howey Test,” derived from the Supreme Court decision SEC v. W.J. Howey Co. This has been used to determine the presence of an investment contract. As stated, the flexible test focuses on the economic reality of transactions ensuring that it adapts to several schemes devised to utilize others’ money for promised profits.
He added that federal courts have successfully applied these precedents to crypto assets where each case was evaluated on its merits.
The SEC Chair highlighted the petition’s claim that identifying the “issuer” of crypto asset securities is unfeasible. Gensler clarified that an issuer extends beyond a formal company issuing stocks, enclosing any person or entity organizing or sponsoring an enterprise for profit.&nbsp;
The commission’s chief argued that federal courts have effectively identified issuers of crypto assets sold as securities, emphasizing the importance of disclosure to protect investors.
It will be important to see what Coinbase would prefer to do from here. The US’s biggest crypto exchange is still struggling with the legal challenges thrown by one of the largest financial regulators.
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US SEC denies petition for Rulemaking filed by Coinbase, What’s next?

Todayq News

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