SEC in latest press release has provided five more years to digital asset brokers holding custody of security tokens who are following SECs guidelines. This press release comes as a breather for many digital asset and crypto brokers who were under fear due to SECs recent lawsuit on Ripple.
No Enforcement Actions For Digital Asset And Crypto Brokers Following SEC Guidelines
Cryptocurrency industry especially crypto brokers and exchanges are facing lot of heat in light of SECs recent $1.3 Billion lawsuit against Ripple. SEC published an official press release titled “SEC Issues Statement and Requests Comment Regarding the Custody of Digital Asset Securities by Special Purpose Broker-Dealers”.
The press release emphasizes the rules laid out in the Securities Exchange Act Rule 15c3-3 to digital asset securities and states that SEC aims to utilize it to foster innovation in the custody of digital asset securities. The press release states forth,
“for a period of five years, a broker-dealer operating under the circumstances set forth in the statement will not be subject to a Commission enforcement action. “
The commission also requested relevant businesses for comment and the statement will become effective 60 days after publication in federal register.
Why This Press Release Is Important?
Recently, Ripple company that owns 6.4 billion of XRP, previous third largest cryptocurrency by market cap was slapped by a massive 1.3 billion lawsuit for dealing in securities. SEC previously also has been very cautious with cryptocurrency businesses and has taken necessary actions for ex. ICO scams for 2017.
The crypto exchanges and brokers were in fear of SEC actions and analysts anticipated a wide delisting of XRP token. The XRP price already plummeted by more than 40% and resulted in delisting of coin from few exchanges.
This news will be breather for exchanges and brokers dealing in XRP which is being called security by SEC.
Luke has had a long interest in financial technology, especially cryptocurrency and blockchain. With a Bachelors degree in Journalism and Media, Luke is dedicating his writing skills for the digital currency sphere.He can be contacted at email@example.com