SEC Chairman Jay Clayton has realized something the crypto community has been trying to tell him for years – cryptocurrencies aren’t stocks. In an interview with CNBC this morning, Clayton offered the securities regulator’s latest take on bitcoin, and it seems they appear no closer to providing any clarity for traders and blockchain startups today than they were a year ago. This is a setback for tech innovation in the U.S. because the more time the SEC takes, the more entrepreneurs are going to decide to pack their bags and take their successful projects elsewhere.
Clayton in the interview described how individual investors would look at bitcoin and be fooled into thinking that it trades similarly to a stock or bond even though it doesn’t. He added:
“We have sophisticated rules and surveillance to ensure that people are not manipulating the stock market. Those cryptocurrency markets by and large do not have that.”
The issues that make the SEC uncomfortable about a bitcoin ETF include:
- Custody (incidentally, Fidelity Digital Asset Services provides crypto custody)
- Lack of rules
SEC Chairman Jay Clayton on #Crypto:
“We have sophisticated rules & surveillance to ensure that people are not manipulating the stock market. Those cryptocurrency markets by and large do not have that.”475:22 AM – Jun 6, 201930 people are talking about thisTwitter Ads info and privacy
Did Someone Say Manipulation?
There are a couple of different ways to dissect this. First, it’s the job of regulators and lawmakers to create a framework by which cryptocurrencies can trade and companies can raise funds, etc. So when he says that the guidelines are missing in crypto, this is where he should look in the mirror. Clayton seems to know this, adding:
“And we’re working hard to see if we can get there. But I’m not just going to flip a switch and say ‘this is just like stocks and bonds.’