Even before President Donald Trump’s arrival and his crypto-friendly supervisory authorities, the US Securities and Exchange Commission had a crypto-spokesman, Commissioner Hester Peirce, who claims that a decision this week to give DoubleZero a so-called letter without action representing the kind of space she has long wanted to offer Blockchaine.
The SEC staff accepted the start -up request that the agency would not pursue any registration complaints for tokens issued for the specific goals of Doublezero’s decentralized physical infrastructure network (Depin). Commissioner Peirce suggested that this open door to the depin effort keeps sec out of operation it should not be in.
“Instead of relying on centralized corporate structures to coordinate activity, depin projects enter into participants to give the real world capabilities, such as storage, telecommunications bandwidth, mapping or energy, through open and distributed peer-to-peer networks,” she said in a statement. The activity does not trigger the Supreme Court’s Howey test – the test that decides what is falling within SEC’s jurisdiction – because such projects “assign tokens as compensation for work done or services provided, rather than as investments with an expectation of profits from other people’s entrepreneurial or management efforts.”
SEC uses non-action letters to make it clear what activities do not intend to pursue with enforcement actions, so a letter to a single company can signal to a whole space what the agency’s current attitude is. But to reap the benefits, the activity must remain strictly within the limits described in the SEC’s letter.
“The line between tokens and securities dish becomes clearer,” said Austin Federa, DoubleZero-co-founder, in a statement to Coindesk. “Founders who once spent countless hours (and legal dollars) on this question can now focus on building.”
Doublezero tried to incentive providers of networking infrastructure, such as large technology companies that control excess fiber networks, by compensating them with tokens – in this case the original 2z of the protocol.
“Treatment of such tokens as securities would suppress the growth of networking of distributed providers of services,” Peirce said. “Blockchain technology cannot reach its full potential if we force all activities into existing regulatory framework for financial market framework.”
Agency’s action raised praise from advocates of decentralized funding (DEFI). “No-Action letters are one of the most pragmatic tools to navigate regulatory uncertainty in Crypto, and SEC’s issue of no-action letters shows that constructive commitment with regulators is possible,” said Amanda Tuminelli, executive director of the Defi Education Fund, in a blog after the double beginning.
SEC has pursued an aggressive course with pro-crrypto-political acts under President Paul Atkins. Earlier this week he said at a roundtable event at the agency’s headquarters in Washington that establishing clear rules for the sector for digital assets is “Job One” for SEC. Before Atkins arrived, the Peirce agency led the crypto -task force and already worked with political statements to clarify the regulator’s expectations of the industry.
Read more: DoubleZero ‘New Internet’ for Blockchains -Nabs $ 400 million.
