SEC reopens comment period on rulemaking on DeFi protocol

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SEC reopens comment period on rulemaking on DeFi protocol

The SEC reopened the comment period on a rule marking for DeFi.

The SEC has reopened the comment period on a rulemaking that could categorize many DeFi protocols as an 'exchange' under the law.

In the case of DeFi protocols, which don't have control over user assets or information, it's clear how they'd even be able to comply.

Whitehouse-Levine said the president would not comment on whether the deal was worth it.

The government agency released a 166-page document on April 14, addressing comments submitted during previous periods on April 14. After an initial proposed 634-page rulemaking in January 2022, which aimed to define which types of entities the SEC will regulate as exchanges, it comes after an initial proposed 634-page rulemaking released in January 2022.

Crypto projects are getting more attention around the SEC throughout 2023. The agency filed a civil lawsuit against the Bttrex exchange on Monday, alleging it traded unregistered securities. A Wells Notice was received last month by Coinbase, which alleged the firm was infringing on securities laws.

Hester Pierce, a five-member SEC committee chairman and a supporter of the crypto industry, issued a response to moves by the agency to alter the definition of an exchange.

The proposed rulemaking relies on the concept of a communication protocol system, which White House-Levin says has a purposely hazy definition. 'T define it,' he said.

Despite the rulemaking, a person is obligated to launch an exchange under the law if they make one of these systems available.

Looking ahead, Whitehouse-Levine sees three potential next steps for the SEC's rulemaking, one option, the least desirable for the crypto faithful, is that the SEC could move to finalize the rulemaking subject to a vote.

The second, is yet another comment period is instituted. Third, likely the best for the crypto ecosystem's future in the United States, is that the rulemaking effort never surfaced again.

Were the SEC to move to finalize the rulemaking, Whitehouse-Levine anticipates a high degree of resistance from both within the crypto community and outside of it. The CEO of the DeFi Education Fund cited a Bloomberg Terminal as being considered an exchange under the SEC's proposed interpretation of the law. Cosme, a former lawyer in the startup and venture capital industry, thinks the resistance to the SEC's proposed rulemaking would be unequivocal. '' s statutory authority given how broad it is, the Defiant told The Defiant.