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Crypto-currencies losing markets will not receive a boost from the Securities and Exchange Commission. On Tuesday, SEC Chairman Jay Clayton shared his new concerns about ETFs in digital currency, citing fears of theft and market manipulation.
Speaking at the Consensus Invest Summit in New York, Clayton said he would only support ETFs, financial products to track badets such as gold or oil baskets. Shares, in which the only risk to investors is related to the value of the underlying badet.
The SEC has repeatedly rejected offers to list a bitcoin-ETF filed by various plaintiffs, including the Winkelvoss twins of Facebook fame. Clayton's renewed skepticism is therefore not surprising, but will further discourage crypto-boosters who have long believed that an ETF will help propel digital money to the marketplace.
"When you see an Nasdaq or NYSE badet swap, there's a lot of monitoring that keeps you from teaming up and pretending we're decentralized. These guarantees do not exist in many markets where digital currencies negotiate, "Clayton said.
He added that the underlying badets of the existing ETFs were not at risk of "theft or disappearance" – which he did not believe was the case for the proposed digital currency ETFs, although the Cryptography has recently focused on secure custody offers.
Clayton also addressed the question of when digital tokens are securities, reiterating the agency's earlier badertion that the question largely depends on whether the token is "decentralized".
"When a stock of value becomes truly decentralized [with] No one, no group of people controlling their supply … we said it was distributed, "Clayton said, adding," It has a lot to do with control and the ability to run the business. "
When asked if this definition made the XRP token – currently the second most valuable digital currency – a title, Clayton declined to answer, following a SEC convention of not comment on individual cases on which the agency has not publicly ruled.
Clayton also spoke positively about blockchain technology in general, saying the technology offers "incredible promise" for many sectors, including finance and transportation.
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