SEC’s Latest Crypto Hire is Just a Bitcoin Smokescreen
U.S. regulators may appear to have finally come to terms with the fact that the crypto industry isn’t going anywhere, but they are stalling nonetheless. The Securities and Exchange Commission (SEC) is on the hunt for a crypto specialist attorney, one who will seemingly provide yet more clarity as the agency navigates the choppy market terrain. While it’s good to see the agency dedicating resources to the future of bitcoin and blockchain, these developments have yet to result in any real progress toward regulatory clarity.
Crypto Hires Don’t Bring SEC Closer to Clear Regulatory Framework
The crypto specialist will brief Chairman Jay Clayton on “salient developments” in the industry. | Source: Shutterstock
The SEC’s job posting coincides with the securities regulator announcing days ago it would delay its decision on a pair of bitcoin ETFs until May. According to the job posting, which was listed on the government’s USA Jobs board:
“The Crypto Specialist provides expertise and coordinates the Division of Trading and Market’s activities regarding crypto and digital asset securities.”
This is not the first time the SEC is making crypto-related appointments. So far, given the lack of any clear regulatory framework, however, these moves are little more than a smokescreen. Despite the creation of a FinTech Working Group and a Digital Assets Working Group, the securities watchdog appears no closer to crafting crypto and blockchain regulation today than it was a year ago, let alone approving a bitcoin ETF. They continue to rely on archaic formulas such as the 1946 “Howey Test” to determine if a digital asset fits the bill as a security and should be registered as such.
Incidentally, the crypto specialist will be tasked with working alongside both working groups as well as attending industry events.
Meanwhile, last June, the SEC named Valerie A. Szczepanik as a senior adviser for digital assets and innovation, otherwise known as the crypto czar. If they haven’t been able to make much progress with their own crypto czar, it’s difficult to hold out much hope for a crypto specialist. It’s also hard to imagine that a blockchain specialist will do more to further the crypto cause than SEC Commissioner Hester Peirce, also known as Crypto Mom. Peirce is the industry’s best hope to influence crypto regulation that embraces tech innovation rather than shuns it.
SEC Punts on Bitcoin ETF Bids
The crypto specialist attorney will be responsible for briefing SEC Chairman Jay Clayton about “salient developments” in the space. Incidentally, one such development remains in the hands of SEC commissioners — a bitcoin ETF. Over the weekend, the agency punted on two ETF decisions for applications submitted by Bitwise Asset Management/Arca and VanEck/SolidX with the Cboe until May 16 and May 21, respectively. At this rate, the industry might not see this institutional product until 2020, especially if the hiring of a blockchain specialist is needed first.
One financial media publication confused things by publishing an April Fool’s joke suggesting that the SEC had decided to approve a bitcoin ETF. While the joke failed to go over well in all of crypto-land, VanEck’s director of digital assets strategy, Gabor Gurbacs, didn’t seem to mind.