The U.S. Securities and Exchange Commission (SEC) has withdrawn certain proposed rules that were pushed under former chair Gary Gensler. This decision is positively received within the crypto industry, which had criticized the strict regulations.
Withdrawal of SEC Rules
The SEC officially withdrew 14 notices of proposed rulemaking issued between March 2022 and November 2023. These include Exchange Act Rule 3b-16, which aimed to define DeFi platforms as exchanges, and crypto custody rules that mandated investments to be conducted only through regulated custodians.
Crypto Industry Response
Coinbase CLO Paul Grewal briefly reacted to the news of the SEC's decision, noting that Rule 3b-16 and other proposed rules are now officially canceled.
Bill Hughes, director of global regulatory matters at ConsenSys, praised the SEC’s decision, stating that it 'feels good.'
ConsenSys founder Joe Lubin pointed out that digital assets differ from traditional securities and require new regulations. Also, Solana Labs co-founder Anatoly Yakovenko characterized the situation as a victory for crypto innovation.
Future of Crypto Regulation
As part of the SEC's efforts to enhance crypto regulation, acting chair Mark T. Uyeda has raised questions about a new approach to cryptocurrency regulation, emphasizing the need to create rules that support rather than punish the crypto community. The SEC has also suspended enforcement actions regarding companies like Binance and Ripple.
The SEC's withdrawal of proposed rules related to DeFi and crypto custody represents a significant move towards greater clarity and support in the regulation of the crypto industry, positively impacting its development.
