Summary
- JPMorgan, Citadel, and SIFMA representatives reportedly conveyed concerns about the SEC’s crypto asset policy.
- They said the SEC’s “Innovation Exemption” for token securities could have negative effects on the financial system.
- They warned that excessive regulatory easing could lead to market instability and systemic risk.
JPMorgan and Citadel, along with representatives from the Securities Industry and Financial Markets Association (SIFMA), reportedly held a meeting recently with officials from the U.S. Securities and Exchange Commission (SEC)’s crypto asset task force (TF) and conveyed concerns about the SEC’s crypto policy.
According to crypto-focused outlet Decrypt on the 28th (local time), they said the SEC’s proposed “Innovation Exemption” for token securities could have negative repercussions across the broader financial system. The framework would allow crypto firms to issue and trade tokenized securities without going through the formal securities registration process.
Participants reportedly warned that excessive regulatory easing could heighten market instability, citing an episode in October last year when roughly $19 billion in leveraged positions were liquidated in a short period. The example was cited to underscore that innovation under insufficient oversight can translate into systemic risk.
The SEC has recently been moving to overhaul rules for crypto assets and tokenized securities and is in the process of gathering input from both the related industry and traditional finance.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.
