The US Securities and Exchange Commission (SEC) assesses a potential exemption order with which companies can issue and act effects using Distributed Ledger Technology (DLT).
SEC commissioner Hester Peirce unveiled this plan during an address of 8 May at the International Institute for Securities Market Growth and Development of the Agency.
SECs proposed crypto -framing
According to Peirce, the Crypto Task Force of the SEC is investigating a conditional order to alleviate the legal costs for platforms aimed at tokenized effects.
The measure would enable qualified companies to use DLT for trade, clean up and sinking without registering under traditional SEC frames.
Peirce acknowledged that the current rules, such as those under the national market system of the regulations, create obstacles for companies that are interested in automated market models. Many of these companies may be obliged to register as Makelaars dealers, clearing agencies or fairs, which entail long-term and expensive compliance processes.
The current barriers, together with the limited availability of Tokenized effects and trading locations, have discouraged many companies from going into space.
Peirce believes that a customized exemption can lower these obstacles and give the SEC room to design updated rules that match blockchain technologies.
She said:
“Exemption can help to solve this problem with chicken and egg. It would also afford the sec time to develop and take on sustainable adjustments to the existing rules to house DLT.”
In the meantime, the proposed exemption would not be without guarantees. Peirce emphasized that a company that has granted exemption should follow strict guidelines to guarantee transparency, financial responsibility and investor protection.
In addition, the companies must reveal how their platforms work, provide details about wallet and guardianship schemes and outline any blockchain-specific risks. These entities would be subject to SEC -SUPERVISION and are expected to maintain sufficient capital to support their services.
Peirce also pointed out that the Agency is considering preventing fraud and market manipulation. This includes mandatory disclosures of customers and robust monitoring protocols.
She concluded:
“This sketch of a potential exemption is a work-in-progress. The aim is to formulate a commercially feasible approach that protects investors, also by ensuring that they have the advantage of advanced trade, clearing and setling effects. I welcome feedback from market participants and other interested parties.”