On September 17, Minnesota Representative Tom Emmer, together with House Financial Services Committee Chairman Patrick McHenry, wrote to SEC Chair Gary Gensler requesting clarity on whether crypto airdrops are securities transactions.
Call to SEC
Congressmen Tom Emmer and Patrick McHenry expressed concern over the current regulatory status of crypto airdrops in the United States. In their letter to SEC Chair Gary Gensler, the politicians asked for clarification on whether such operations are considered securities transactions.
Importance of Airdrops
According to Tom Emmer, airdrops play a significant role in incentivizing participation in blockchain applications, which contributes to their continued development, initial governance, and eventual decentralization. However, due to unclear regulatory status, developers often block Americans from accessing such tokens. The congressmen also highlighted that misapplying securities laws could hinder the technology from reaching its full potential.
Fraud Concerns
One major concern with crypto airdrops is their tendency to experience sudden price drops immediately after issuance. This phenomenon has been observed in several high-profile cases, such as Uniswap (UNI), Apecoin (APE), and dYdX, whose values have significantly dropped from their peak levels.
The congressmen's letter demands the SEC provide answers by September 30 to ensure clarity and prevent hindrance to technological development.
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