Earlier this week, an announcement on the Securities and Exchange Commission Website revealed that Jay Clayton, the current chairman of the commission, will be exiting in 2021 and has held his current position since 2017, making him one of the longest-running chairs of the commission.
Clayton has not necessarily been an ally of the cryptocurrency community. During his time, many players in the industry tried to get a Bitcoin Exchange-Traded Fund (ETF) approved by the commission. However, those were denied repeatedly.
Clayton on Bitcoin
Now, before officially stepping down, Chairman Clayton has expressed his views regarding Bitcoin, telling CNBC that “inefficiencies” in the current payments systems are continuing to drive the popularity of Bitcoin.
Speaking during an interview on CNBC’s Squawk Box on November 19, Clayton confirmed that the SEC views bitcoin as a payment mechanism and store of value and not as a security.
“Well, let’s put it this way. We did not regulate Bitcoin as a security. We determined that Bitcoin was not a security; it was much more a payment mechanism and a store of value […] the government does regulate payments. We’re going to see more regulations around the payment space.”
It must be noted that despite never allowing an ETF, Clayton never opposed bitcoin’s core principles, but rather expressed his concerns that investors or those without proper knowledge could be subject to unnecessary risks when investing in a Bitcoin ETF.
Basically, the SEC is worried that the unregulated nature of some bitcoin exchanges makes the price of the asset subject to easy manipulation. However, Clayton believes bitcoin will continue to grow while the regulations also evolve with the changing nature of the market.
“What we are seeing is that our current payment mechanisms, domestically and internationally, have inefficiencies. Those inefficiencies are the things that are driving the rise of Bitcoin… And we’re gonna see more of that. We’re gonna see this mature and we’re gonna see more regulation around the digital payment space.”
The ICO warning
And it’s not just Bitcoin and ETFs, Clayton had also raised serious concerns regarding the risks surrounding ICOs back when those were booming in 2017, to remind the public that was considered securities offerings and is subject to regulation.
“When people use crypto assets as securities to raise capital for a venture, the SEC regulates that. And what was happening in the ICO craze was people were using ICOs and essentially making offerings of public securities without registering them with the SEC.”
As of now, industry experts consider Clayton stepping down as a renewed chance of a Bitcoin ETF being approved. Every crypto enthusiast is hoping that that the next chairman is going to be more open minded towards cryptocurrencies like SEC Commissioner Hester Peirce.