During a virtual hearing of the Task Force on Financial Technology that was recently formed by members the U.S. House Financial Services Committee, its ranking member Tom Emmer (R-MN) once again made a case for regulatory clarity in the cryptocurrency industry:
“So long long as actors play by the rules of the road, they deserve the assurances that regulators will not continue to cause uncertainty and will, in fact, support innovation in America.”
Making securities laws tech-agnostic
In his statement, Emmer mentioned the recently introduced "Securities Clarity Act" that would help to clarify existing securities laws in a “technologically-agnostic” way. It would set resultant tokens apart from investment tokens:
“The purpose of this Act is to clarify and codify that an asset sold pursuant to an investment contract, whether tangible or intangible (including an asset in digital form), that is not otherwise a security under the Act, does not become a security as a result of being sold or otherwise transferred pursuant to an investment contract.”
The lawmaker believes that this would allow the U.S. to remain competitive in the blockchain industry without sacrificing the investors’ safety.
As reported by U.Today, Emmer opined that XRP wasn’t a security while praising the cryptocurrency for its ability to eliminate intermediaries in late August.
Ripple is currently battling several lawsuits that accuse it of violating securities laws by distributing XRP, with the oldest one dating back to May 2018.
Creating laid-down rules
Emmer also asked SEC’s Brian Knight about Telegram and Kik enforcement actions as well as the “safe harbor” proposal for cryptocurrency assets that was earlier outlined by SEC Commissioner Hester Peirce.
To this Knight replied that the securities watchdog didn't want “regulation by enforcement,” mirroring Peirce’s stance:
“The concept of justice and, frankly, efficiency and effectiveness indicate that we should have clearly laid-down rules before we gonna bring an enforcement action and punish someone for a violation.”
Telegram CEO Pavel Durov criticized the SEC’s last-minute decision to shut down the Telegram Open Network (TON) after losing the legal battle with the agency back in May.