According to an April 25 comment letter, NASDAQ urges the Securities and Exchange Commission (SEC) to retain digital assets to the same regulatory standards as the securities when it constitutes “stocks under other names.”
The exchange said US financial regulators need to establish a clearer taxonomy of cryptocurrencies, such as classifying some of their digital assets as “financial securities.” Nasdaq argued that these tokens should continue to be regulated “as they are regulated today, regardless of their tokenized form.”
“Whether it takes the form of paper share, digital share or tokens, the underlying properties of instruments remain the same and must be traded and regulated in the same way,” the letter states.
It also proposes classifying some of the cryptocurrencies as “digital asset investment agreements,” which are subject to “light touch regulations,” but are overseen by the SEC.
Related: The SEC says certain Stablecoins are not securities
Regulated U-turn
The SEC has dramatically pivoted its stance on cryptocurrency surveillance since US President Donald Trump took office in January.
Under the guidance of former chairman Gary Gensler, the SEC took the position that virtually all cryptocurrencies except Bitcoin (BTC) represent investment contracts and therefore qualify as securities.
This stance led the agency to raise 100 cases against crypto companies on suspicion of breaching securities law.
However, after a lengthy Senate confirmation, under Trump candidate Paul Atkins, who was sworn in as chairman on April 21, the SEC claimed jurisdiction over a narrower segment of cryptocurrency.
In February, the agency issued guidance if Memecoin is clearly identified as a purely speculative asset with no intrinsic value and does not qualify as an investment contract under US law.
In April, the SEC said it would not qualify as a securities if stubcoins (digital tokens pinned to US dollars) were similarly sold only as a payment instrument.
Integrate Crypto with tradfi
In a letter on April 21, NASDAQ said that existing financial infrastructure can easily absorb digital assets by establishing appropriate taxonomy, proofreading certain rules, and reflecting what is truly new and novel about digital assets.
Dository Trust & Clearing Corporation (DTCC), a private US securities clearing house that is closely monitored by the SEC, has laid the foundation for integrating blockchain technology into regulated financial markets.
In March, the DTCC committed to promoting Ethereum’s ERC-3643 standard for permitted securities tokens.
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