In recent months, the Securities and Exchange Commission (SEC) under Gary Gensler has been under fire over its “regulation-by-enforcement” policy, and many are looking for clarity in crypto rules.
Today, the crypto industry moved a few steps into clarity when a Texan federal judge tossed the agency’s broker-dealer rule. By SEC’s proposed definition, the term “dealer” includes all liquidity providers and market makers that hold over $50 million in capital.
According to Texas Judge Reed O’Connor, the agency has overstepped its authority by adopting a broad definition of a “dealer” unrelated to the Exchange Act’s text, structure, and spirit.
The crypto community has lauded this legal win, with Marisa Tashman Coppel of the Blockchain Association calling it a massive win for the growing industry.
DEALER RULE STRUCK DOWN! SEC exceeded its statutory authority. HUGE win for the entire industry @BlockchainAssn and @CryptoFreedomTX !!! pic.twitter.com/Zv1Mhv1uwl
— Marisa Tashman Coppel (@MTCoppel) November 21, 2024
SEC Offers An Expanded Broker-Dealer Definition
On February 6th, 2024, the SEC adopted new rules for market participants and updated the definition of the broker/dealer. Under the agency’s revised rules, market participants with over $50 million in capital must register as dealers or securities dealers.
At the time of the rules’ publication, over 40 market participants must register and be subject to the broker’s definition and regulations.
As of today, the market cap of cryptocurrencies reached $3.24 trillion. Chart: TradingViewGo to Source to See Full Article
Author: Christian Encila
