The US Securities and Exchange Commission seek to ensure transparency and trust among investors. Brokers will be exempt from receiving regulatory sanctions for 5 years.
In recent days, the US Securities and Exchange Commission (SEC) requested comments to outline new rules for the custody of tokenized shares. The objective of the regulatory agency is to set work parameters for brokers or stockbrokers.
According to a report, the SEC seeks to foster innovation around the application of rule 15c3-3 of the Securities and Exchange Law. In other words, the entity wants to establish a new regulation and protect investors who want to have exposure to digital asset securities.
“The SEC requests comments to provide the Commission and its staff with an opportunity to better understand the evolution of regulations and best practices concerning the custody of digital asset securities. This knowledge will serve as the basis for any possible future action in this area by the Commission,” said the agency.
In addition to requesting comments, the SEC also stated about brokers and the custody of digital asset securities. The provision indicates that brokers will be exempt from receiving regulatory sanctions for a period of up to five years if they meet some requirements.
Among the obligations of stockbrokers are to have control of digital asset securities, limit their operations only to this type of assets, establish procedures to mitigate the associated risks, and inform their customers about the commercial risks of investing in these types of assets.
The provision seeks to encourage the reception of comments and set parameters for brokers to conduct the corresponding operations. As a result of the above, there is the emergence of the SEC’s recognition of a market in transformation and constant evolution that Bitcoin leads.
The release of the statement occurred a few hours after the SEC itself had sued Ripple and its founders over multi-million dollar sales of XRP. The Commission considers that the cryptocurrency is an unregistered security, while the company argues that it is a virtual currency.
Ripple may have raised more than USD 1.3 billion from XRP sales since 2013, said the SEC. That news caused the price of the crypto asset to collapse, with a decline that exceeded 30% in a few hours.
In October, outgoing SEC chairperson Jay Clayton stated that the commission was willing to promote those tokenized shares on the blockchain, as long as they were registered with the organization. The executive praised Bitcoin’s technology and the potential that it has for creating new trades on stock exchanges.
The difference between trading traditional securities and digital asset securities is what led to the emergence of the SEC’s ruling. Even though both worlds operate digitally, they have different technical requirements for transactions and custody.
By Alexander Salazar