The US Securities and Exchange Commission (SEC) flags possible objections to FTX’s proposed plan to repay creditors with stablecoins.
In a new official court filing, the SEC acknowledges that FTX’s Chapter 11 repayment plan may not be illegal, while maintaining that the regulator has the right to challenge transactions involving cryptocurrencies.
“The SEC has no opinion on the legality, under the federal securities laws, of the transactions described in the Plan and reserves the right to challenge transactions involving crypto assets.”
The SEC’s warning has drawn criticism from critics who say the agency may be overstepping its regulatory authority.
Says Galaxy Digital Head of Research Alex Thorn about the warning:
“The SEC once again reserves the right to claim that dollar-backed stablecoins are ‘crypto asset securities’ despite dropping their enforcement against Paxos and losing their MTD on BUSD against Binance in July.
this is the height of jurisdictional overreach
it’s kind of absurd when you think about it. no one, including most other regulators and both parties, believes the SEC should oversee true “number stay flat” technologies
the SEC doesn’t even advocate this. they’re just not willing to let it go. it is a cudgel they must keep sharp, lest any legitimate actor deign to wield these (boringly excessive) tools.
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