SEC clarifies Filecoin’s FIL token as security, Greyscale pushes back

TL;DR Breakdown

  • The SEC labels Filecoin’s FIL token as a security, leading to the rejection of Grayscale’s application for a Filecoin Trust product.
  • Grayscale disagrees with the SEC’s decision, intending to present its legal rationale against the classification.
  • This decision signifies the SEC’s intensified scrutiny of the crypto industry, spotlighting the ongoing debate over digital token classification under U.S. securities law.

The world of digital currencies has been hit with another shockwave as the U.S. Securities and Exchange Commission (SEC) enters yet another dispute over the classification of a major cryptocurrency. This time, the regulator has identified the digital token of Filecoin (FIL), managed by Protocol Labs, as a security, creating ripples of concern within the global crypto industry.

A regulatory crackdown on crypto

In a recent statement, Grayscale Investments, one of the largest crypto asset management firms, announced that it received a letter from the SEC rejecting its application to launch a Filecoin Trust product. The SEC posited that Filecoin’s FIL token satisfies the criteria of a security under federal law and, therefore, Grayscale’s application was deemed inappropriate.

This development signifies a continuation of the SEC’s intensified scrutiny of the digital asset sector under the stewardship of Chairman Gary Gensler. This year, crypto exchanges, including Kraken, Bittrex, and Coinbase, have been targeted for allegedly dealing in unregistered securities. The SEC’s broadside against Filecoin could be indicative of a stricter regulatory regime on the horizon for the nascent industry.

Amid the regulatory ambiguity, FIL, the 33rd largest digital asset by market capitalization, faced a slight dip in its value, currently trading at $4.54, according to CoinGecko.

Grayscale’s standoff with SEC

Despite the SEC’s verdict, Grayscale remains undeterred. In their statement, the firm firmly disagreed with the SEC’s classification, asserting that FIL does not qualify as a security. They have pledged to provide the SEC with a detailed legal rationale for their position in a timely manner.

Interestingly, the SEC’s decision to label FIL as security veers from the pattern of the Howey Test, a measure often invoked by the body to define a digital asset. The test brands an asset as an “investment contract” if funds are contributed with an expected profit derived from the enterprise’s efforts. The ongoing dispute raises questions about the classification of digital assets and the applicability of existing laws on revolutionary blockchain technology.

At the heart of this debate is the fundamental difference in views held by the SEC and crypto industry operators. While Gensler has continually affirmed that most digital tokens are securities—with Bitcoin being a notable exception—entities such as Grayscale contest this perspective. These divergent views could significantly impact the landscape of crypto investing and the path toward wider crypto adoption.

The lack of clear guidelines governing digital assets under U.S. securities law has further heightened the uncertainty. The crypto industry, characterized by its rapid pace of innovation, frequently grapples with regulatory frameworks that struggle to keep pace. The SEC’s recent move serves as another call to action for stakeholders to address these regulatory gaps.

In the wake of this development, the fate of Filecoin’s FIL token, which raised a staggering $200 million in an initial coin offering (ICO), hangs in the balance. Whether Grayscale’s response convinces the SEC or the firm is forced to seek alternatives remains a much-anticipated question in digital asset regulation.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

文章来源于互联网:SEC clarifies Filecoin’s FIL token as security, Greyscale pushes back

Disclaimers:

1. You are solely responsible for your investment decisions and this info is not liable for any losses you may incur.

2. The copyright of this article belongs to the writer, it represents the writer's opinions only, not represents the site's ones. Not financial advice.

Previous 2023年5月18日 22:29
Next 2023年5月19日 01:52

Related articles

  • Euro’s troubles unveil Europe’s economic fears

    Description Europe’s economic backbone seems to be creaking under the weight of the recent struggles faced by the Euro. And while the European Central Bank’s (ECB) unprecedented decision to hike the deposit rates to 4% — the highest in the Euro’s history — might have aimed to strengthen the currency, it only deepened the turmoil, leaving … Read more Europe’s economic backbone seems to be creaking under the weight of the recent struggles faced by the Euro. And while the European Central Bank’s (ECB) unprecedented decision to hike the deposit rates to 4% — the highest in the Euro’s history — might have aimed to strengthen the currency, it only deepened the turmoil, leaving investors wary of the economic landscape in Europe. Defying Expectations: Euro’s Unexpected Decline Traditionally, a rise in rates spells good news for currencies. The underlying logic is simple: higher interest rates should attract more foreign capital, hence boosting the currency’s value. But, the Euro’s story didn’t play out this way. It was a blow, not just to the common man but to market analysts too. Just…

    Article 2023年9月16日
  • ECB raises interest rates to record high in an effort to cool consumer prices

    TL;DR Breakdown The European Central Bank (ECB) has raised interest rates to a record high, marking the 10th consecutive increase. This rate hike comes as the eurozone economy faces challenges, including slowing bank lending, a cooling labor market, and falling inflation. ECB President Christine Lagarde mentioned that she has left the possibility of a further rate hike open. Description The European Central Bank (ECB) has taken a bold step by raising interest rates to an unprecedented level, aiming to control consumer prices. This decision, reached during the governing council’s meeting in Frankfurt on Thursday, marked the 10th consecutive increase, with the deposit rate raised by 25 basis points to 4 percent. It’s worth noting … Read more The European Central Bank (ECB) has taken a bold step by raising interest rates to an unprecedented level, aiming to control consumer prices. This decision, reached during the governing council’s meeting in Frankfurt on Thursday, marked the 10th consecutive increase, with the deposit rate raised by 25 basis points to 4 percent. It’s worth noting that this move occurred simultaneously with officials revising…

    Article 2023年9月15日
  • Russia to recognize foreign CBDCs as digital ruble law takes effect

    TL;DR Breakdown Russia has announced that it will recognize digital currency issues by other countries country’s as its CBDC law takes effect. Bank of Russia in talks of integration its CBDC with other payment systems. Description In a significant development, the Russian government has officially acknowledged digital currencies issued by other nations, signaling an important step in the country’s evolving stance on cryptocurrency. Alongside this move, the country has also implemented a dedicated law that regulates its digital currency, the digital ruble. Reports from local crypto media outlets reveal that the … Read more In a significant development, the Russian government has officially acknowledged digital currencies issued by other nations, signaling an important step in the country’s evolving stance on cryptocurrency. Alongside this move, the country has also implemented a dedicated law that regulates its digital currency, the digital ruble. Reports from local crypto media outlets reveal that the country’s legal recognition of foreign digital currencies parallels the adoption of its digital ruble. Russia amends its federal law on currency control According to the official online portal for legal information,…

    Article 2023年8月7日
  • SEI joins Korean Won and Bitcoin markets on Upbit’s trading platform

    TL;DR Breakdown   South Korea’s top digital asset exchange, Upbit, is set to introduce SEI trading, expanding its portfolio and catering to its global users. The Sei Network is the only platform that supports SEI deposits, distinguishing it from other networks like BSC. Upbit has scheduled the commencement of SEI deposits and withdrawals for August 15th, 2023, at 21:00 KST. Description Upbit, South Korea’s leading global digital asset exchange, has announced its plans to introduce SEI trading. This decision comes as the exchange seeks to diversify its trading portfolio and cater to the evolving needs of its global clientele. Consequently, the Korean Won and Bitcoin (BTC) markets are set to welcome a new entrant, SEI. Moreover, … Read more Upbit, South Korea’s leading global digital asset exchange, has announced its plans to introduce SEI trading. This decision comes as the exchange seeks to diversify its trading portfolio and cater to the evolving needs of its global clientele. Consequently, the Korean Won and Bitcoin (BTC) markets are set to welcome a new entrant, SEI. Moreover, the Sei Network is the sole…

    Article 2023年8月15日
  • Twitter blatantly refuses to pay its Google Cloud bills

    TL;DR Breakdown Twitter has refused to settle its debts to Google Cloud, potentially impacting its trust and safety mechanisms. The conflict began before the contract renewal this month and Twitter has sought a renegotiation of its Google contract since March. The company’s tech infrastructure hosts some services on its own servers, while others are on Amazon and Google’s cloud platforms. Shaking the sphere of digital business, Twitter has reportedly declined to clear its debts owed to Google Cloud, a move that could put the social media giant’s trust and safety mechanisms in jeopardy. The deadline for payment has passed with the contract renewal slated for this month, a situation causing some ripples across the sector. An unsolved debt dispute When a multi-year contract with Google was inked before Elon Musk’s epoch-defining acquisition of Twitter, the focus was on intensifying efforts to combat spam and safeguard accounts, among other objectives. However, as this dispute festers, concerns have arisen about potential adverse effects on Twitter’s trust and safety functions, though specific implications remain unclear. The tech giant has been reportedly pushing for…

    Article 2023年6月13日
TOP