tl;dr
The Securities and Exchange Commission (SEC) has voluntarily dismissed its appeal of a ruling that prevented the agency from expanding securities laws to cover decentralized finance (DeFi) users and projects. The appeal was dismissed unopposed, marking a victory for the digital assets industry. The ...
The Securities and Exchange Commission (SEC) voluntarily dismissed its appeal of a ruling that prevented the agency from expanding securities laws to cover decentralized finance (DeFi) users and projects. The appeal was dismissed unopposed, marking a victory for the digital assets industry.
The ruling, which found the SEC's expansion of the legal definition for "dealer" to be unlawful, stemmed from a lawsuit filed by the Blockchain Association and Crypto Freedom Alliance of Texas.
SEC's enforcement actions under former Chair Gary Gensler's leadership, including cases against Binance and Coinbase, have stalled. Both companies are navigating legal disputes with the SEC regarding their operations as securities exchanges. Additionally, conflicting court rulings have prompted a federal judge in New York to allow Coinbase to seek an appeal in its legal fight with the SEC.
The SEC's voluntary dismissal of its appeal represented a major win for the digital assets industry, signaling a more collaborative approach to regulations. The expanded definition of dealer, requiring DeFi protocols to register with the SEC as securities exchanges and brokers, faced legal challenges and criticism from SEC Commissioner Hester Peirce.
Following Gensler’s departure, SEC leadership has signaled a more collaborative approach to policing the crypto space, with a focus on establishing clear rules. Enforcement actions taken under Gensler’s leadership, including cases against Binance and Coinbase, have stalled. Conflict in court rulings has prompted a federal judge in New York to allow Coinbase to seek an appeal in its legal fight with the SEC.