Nasdaq, the operator of one of many premier U.S. inventory exchanges and a crypto index, is advising the U.S. regulators to fastidiously deal with defining digital property in 4 buckets that may clearly decide which company acts as referee, in response to a 23-page letter despatched to the Securities and Trade Fee’s crypto activity pressure.
“While a stock by any other word would still be a stock, the existing market ecosystem can readily absorb digital assets by establishing the proper taxonomy and calibrating certain rules to reflect what is truly new and novel about digital assets,” the letter argued in response to the invitation issued by the duty pressure’s chief, Commissioner Hester Peirce, to weigh in on future rules.
The 4 future classes of digital property, in Nasdaq’s view, must be:
- monetary securities (tokens tied to property which can be securities beneath current definitions, like shares, bonds and exchange-traded funds (ETFS), which Nasdaq stated must be handled simply the identical as their underlying property);
- digital asset funding contracts (tokenized contracts that examine all of the securities packing containers beneath a “clarified version” of the Supreme Court docket’s so-called Howey check);
- digital asset commodities (assembly the U.S. definition of commodities)
- different digital property (stuff that does not fall wherever else and should not have guidelines for securities or commodities imposed on it)
The securities classes belong within the palms of the SEC, which can be working with its cousin company, the Commodity Futures Buying and selling Fee, that may deal with the commodities. These companies — presumably directed in some unspecified time in the future by a brand new crypto regulation hatched by Congress — will work out the exact border between their jurisdictions.
The letter, signed by John Zecca, the corporate’s chief regulator government, argued that “digital assets that constitute financial securities must trade as they do today.”
Nasdaq additionally instructed that the 2 companies ought to formulate a sort of crossover buying and selling designation for platforms that may deal with digital asset funding contracts, commodities and different kinds of property beneath one roof.
Within the letter, Nasdaq underlined its digital-asset credibility, saying its “trading and clearing services, market and trading surveillance, and central securities depository technology support digital assets platforms on six continents.” It contended that the regulators ought to think about imposing security measures or additional constraints on corporations that wish to deal with buyers’ exercise from prime to backside, which is the widespread method of current crypto corporations.
Learn Extra: SEC ‘Earnest’ About Discovering Workable Crypto Coverage, Commissioners Say at Roundtable
