It looks like the private party is over for cryptocurrency.
Last week, the SEC filed two suits in rapid succession, accusing leading cryptocurrency exchanges Coinbase and Binance on trading unregistered securities. In doing so, the Commission is making an important claim, one that will likely shape the future of virtual currency.
In short, the Commission says cryptocurrencies are securities. If true, any unregistered exchange that sells these currencies, or any exchange which sells these currencies without registering them, is guilty of breaking the rules.
On the surface, that seems a pretty simple proposition. As securities, virtual currencies would be subject to some regulatory oversight, including greater transparency and investor protection.
But isn’t this a threat to the very spirit of decentralized finance? After all, the SEC is pretty central.
Well, here’s the thing. We’re not here to take sides in the battle of regulators versus crypto. As always, we side with individual investors.
