CoinCenter has vigorously pushed back a controversial SEC proposal seeking to redefine the definition of “exchange” within the Securities Exchange Act to include “systems that bring buyers together”. Non-firms offer to use the trading interest and communication protocol as sellers of securities.” The group considered the regulator’s move “unconstitutional”.
Coin Center, a Washington-based non-profit that focuses on cryptocurrency policies, announced the filing of a comment paper with the United States Securities and Exchange Commission (SEC). According to the crypto lobby, the commission’s proposal violates the First Amendment, requiring a license, so to speak, even for the open source developers working behind projects in the ecosystem.
“It’s unconstitutional, and they should change it”
The impetus of think tanks and crypto lobby groups to turn down the SEC’s proposal has drawn close monitoring among the country’s regulators.
Last month, the agency published Amendment with respect to the definition of “exchange”. MAny expert would believe that it aims to bring crypto and most importantly, the decentralized finance (DeFi) sector within its regulatory purview, dramatically redefining the risk profile of operating a project in the US. Can go
Arguing that the impact on developers, publishers and republishers would be adverse, the comment paper from Coin Center stated:
“A new SEC proposal hides a serious change within its complex language. Bottom line: The proposal violates the First Amendment, which requires a license to speak—even for open source developers It is unconstitutional and they should change it. Coin Center is pushing back.”
Narrowing the Definition of “Exchange”
Peter Van Valkenburgh, the nonprofit’s director of research, said the proposal is “unconstitutional” and the SEC should withdraw it.
The regulatory authority’s interpretation of “exchange” is considered unreasonably broad as the long 200-page document never mentions crypto or DeFi even once. The Sikka Center also cited the previous precedent of the Supreme Court (SC), which could potentially force the SEC to withdraw the proposal if it finalizes the new rule as a draft.
The coin center also said that the commission should narrow down the definition of “exchange” before finalizing a proposal for true professional conduct. Failing to do so could stifle sufficiently protected speech, and stifle innovation in the country, in addition to facing an unfriendly court which, the lobby believes, “could stifle First Amendment freedoms”. To confirm is primary.”
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