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"We are breaking with the past," SEC Chairman Paul Atkins said in an interview with CNBC on Wednesday that followed the release of new government guidance on digital assets.
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The agency guidance would appear a positive development for the industry—but coin prices declined anyway.
A pair of federal agencies handed the crypto industry a big gift—but got little applause in return.
Crypto backers have been waiting for Congress to pass a new crypto law; instead, they got guidance that falls short of the broad reassurance they'd prefer. The Securities and Exchange Commission and Commodity Futures Trading Commission released a joint interpretation of securities laws that categorizes digital assets into four types—digital commodities, digital tools, digital collectibles and stablecoins—and asserts that many major coins are commodities, not securities, offering a measure of clarity for companies that have for years weathered ambiguous rules and a hostile regulator in the SEC under Biden-era Commissioner Gary Gensler. Still, bitcoin and a raft of other major coins, including ether, XRP and even dogecoin, fell today.
Thursday's price action in the crypto market followed what looked like a relief rally, with investors likely expressing fresh concern that the government was no closer to signing the Clarity Act. The act, which would codify as law the interpretations the SEC and the CFTC offered this week, appears to be in limbo as banks and crypto companies wrestle over the rewards that can be offered to the holders of stablecoins. Bettors on Polymarket recently put odds of it passing at 62%, down from 80% last month.
The coin market's lukewarm reaction to the SEC's guidance on digital assets suggests that it might take a larger positive development to drive prices meaningfully higher.
"I can't be any clearer," said Sen. Cynthia Lummis, a crypto advocate. "The time for Clarity is now," she said on social media.
SEC Chair Paul Atkins in an interview with CNBC Wednesday said the agency would follow up "shortly" with a proposed rule to put the guidance into effect and "be much more specific." That would turn its guidance, with which courts can disagree, into rules. Rules, however, can easily change with administrations: The SEC is now reportedly preparing a proposal to tweak one that for decades required public companies to report earnings quarterly, for example. A rule, to put it succinctly, isn't a prize as great as law.
