The securities using Defi tech and SEC keep an eye on the DeFi business

The securities using Defi tech and SEC keep an eye on the DeFi business

Blockchain News
August 30, 2021 by Delnia
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Agreeing to a Friday report from Forbes, an AnChain.AI company representative affirmed the assertion with the government controller, saying the SEC and Blockchain firm had the alternative to sign up to five isolated 1-year contracts for $125,000 each, or $625,000 add up to. The primary contract supposedly started in May. The SEC is highly interested in learning more about what's going on in the realm of intelligent contract-based digital assets, according to Victor Fang, CEO, and co-founder of AnChain.AI.
The securities using Defi tech and SEC keep an eye on the DeFi business

The Securities and Exchange Commission and DeFi businesses

The securities using Defi tech is exceptionally sharp on understanding what is happening within the world of savvy contract-based computerized resources,” said Victor Fang. The U.S. Securities and Trade Commission has supposedly marked a $125,000 bargain with Blockchain analytics firm AnChain.AI to screen and control the decentralized back industry.

Following SEC chair Gary Gensler’s request that decentralized finance, or Defi, businesses register with the agency, claiming that they “decentralized in some respects but very centralized in others“. The government agency and the Blockchain business, according to reports, have reached an agreement. According to Gensler, securities using Defi tech platform developers and others might form a centralized team subject to SEC regulations. The Securities and Exchange Commission (SEC) recently announced that it had filed an enforcement action in the first instance involving securities that use Defi technology.

The sector is valued at more than $126 billion, according to CoinGecko estimates. With almost $1 billion in Defi tokens exchanged in the last 24 hours, Uniswap is the largest decentralized exchange by volume; its UNI token is also the most valued. It is with a market valuation of $14.2 billion.

According to CoinGecko data, the industry is worth more than $126 billion. Uniswap is the largest decentralized exchange in terms of volume, having traded over $1 billion in Defi tokens in the preceding 24 hours; its UNI token is also the most valued, with a market cap of $14.2 billion.

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Crypto Mom: The only thing that can preserve securities using Defi tech initiatives is true decentralization

According to SEC Commissioner Peirce. The only option for Defi founders to avoid financial regulation is to achieve absolute decentralization from the start.

The U.S. Securities and Exchange Commission’s Hester Peirce. Often known as “Crypto Mom,” has warned of widespread “shadow-centralization” in the decentralized finance (Defi) industry.

In a Wednesday conversation with outspoken DeFiWatch founder Chris Blanc, streamed by The Defiant, the SEC commissioner noted that decentralized organizations and Defi are new concepts for regulators. Having a peer-to-peer system that does not rely on central go-betweens is hugely different from what we’re used to.

If you genuinely want to be decentralized, you must be decentralized. Which will put you in a different category from regulators’ perspective. Since its securities using Defi tech, we’ve never dealt with it before.

Regulators will seize a concentrated chunk or group of persons if they can identify one. So,” they think it’s simply prudent to be cautious about how you construct things because it may have regulatory consequences down the road,” she added.

Opinion on the best route for developing securities using Defi tech

Blanc inquired of Peirce about the best method to create decentralized protocols, questioning if developers should strive for the same level of decentralization as Bitcoin.

According to the commissioner, existing regulations intended such that “any company or person acting in the financial industry is likely to come within at least one regulatory framework.”

Peirce advised Defi founders to contact regulators and “figure out if there’s another method […] to comply” if they feel they are engaging in new activities that do not come within the scope of existing regulations.

You must demonstrate that you are not like the CeFi or TradFi systems by explaining that you are doing something unique. Which, in my opinion, needs decentralization.

She emphasized that trust generated from the code differs from trust derived from a particular business or a group of individuals.

What is shadow-centralization

The commissioner also mentioned the presence of “shadow-centralization” in the securities using the Defi technology industry. Where opaque governance arrangements can lead to centralized management of a protocol despite its marketing claims of decentralization.

On the other hand, Peirce advised regulators to adjust to decentralized innovation, saying. “Regulators need to figure out how to cooperate with entrepreneurs.”

She went on to say, “That part of the reason our financial system so centralized“. “Because the only individuals who can afford to wait for approvals are those who already have a lot of money and can afford to hire very excellent lawyers.”

It’s 2021 — Satoshi would very likely still be […] seeking to acquire a no-action letter,” Peirce said in response to the question of what Satoshi Nakamoto‘s experience would have been if they had sought the SEC before releasing Bitcoin.

The SEC has no power over cryptocurrency, according to a CFTC commissioner

Former CFTC Chair Christopher Giancarlo said that the CFTC is the only U.S. Regulatory body with expertise overseeing Bitcoin and cryptocurrency markets.

A commissioner from the Commodity Futures Trading Commission claimed that Crypto regulation did not come under the SEC’s authority, despite the U.S. Securities and Exchange Commission increasing its area of control of the Cryptocurrency business.

Commissioner Brian Quintenz of the Commodity Futures Trading Commission (CFTC) declared on Twitter on Wednesday that cryptocurrencies like Bitcoin (BTC) should be regulated by the CFTC rather than the Securities and Exchange Commission (SEC).

Quintenz emphasized that cryptocurrencies are commodities. And so come within the CFTC’s authority, rather than securities, which the Securities and Exchange Commission governs, stating:

To be clear, the SEC has no jurisdiction over pure commodities or their trading platforms. Whether they be wheat, gold, oil, or crypto assets. Or it is securities using Defi tech.

Quintenz’s comments came less than a half-hour after former CFTC Chair Christopher Giancarlo made a similar assertion on Twitter. Claiming that the CFTC is the only U.S. regulatory body with expertise overseeing Bitcoin and cryptocurrency markets.

Sum-up about securities using Defi tech

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References:
https://cointelegraph.com/news/sec-reportedly-contracts-blockchain…

https://cointelegraph.com/news/crypto-mom-true-decentralization…
https://cointelegraph.com/news/sec-has-no-authority…

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