The U.S. Securities and Exchange Commission (SEC) has postponed an open meeting scheduled for Friday, August 18, 2023, where commissioners were to vote on proposing the agency’s first crypto-specific rules. A spokesperson cited an “unforeseen scheduling issue” for the cancellation, with no new date announced.
The postponed meeting was intended to decide whether to open a proposal for public comment. This proposal would have offered exemptions for crypto startups seeking to raise capital without adhering to traditional securities offering rules. The SEC’s consideration of such specific rules was interpreted by some as an effort to address a regulatory gap.
This development follows the Senate’s departure for a five-week recess without advancing the Clarity Act, legislation aimed at providing a clearer framework for digital assets. The timing of the SEC’s meeting announcement, made shortly before the Senate’s recess, had coincided with interpretations that the agency was moving to fill a void. However, the meeting’s postponement now leaves the path forward for crypto-specific rulemaking uncertain.
Previously, SEC Chairman Paul Atkins had outlined broad guidance for the crypto industry in March, suggesting potential safe harbors for startups raising capital and for tokens whose creators have ceased managerial efforts. A separate innovation exemption was also in progress, intended to allow firms to experiment with blockchain-based securities without meeting all SEC disclosure requirements.
The cancellation leaves key questions unanswered regarding when the SEC meeting will be rescheduled and the specific details of the proposed rules. The ultimate fate and timeline of the Clarity Act also remain in doubt, contributing to the prevailing regulatory uncertainty.
In parallel, the Commodity Futures Trading Commission (CFTC) is proceeding with its own initiatives. The CFTC’s Innovation Advisory Committee is set to hold its inaugural meeting on August 20, featuring a session on “Crypto’s Regulatory Evolution: From Uncertainty to Clarity.” However, the CFTC’s meeting is advisory and expected to produce recommendations rather than binding rules.
The SEC’s postponement underscores the persistent regulatory uncertainty in the U.S. crypto space. The lack of a clear timeline for proposed rules and ongoing legislative delays mean the digital asset industry continues to operate without a definitive regulatory framework.
Why This Matters
The SEC’s cancellation of a meeting to vote on proposing crypto-specific rules, amidst legislative inaction on the Clarity Act, highlights the ongoing ambiguity and potential delays in establishing a clear regulatory framework for digital assets in the US. This situation means the digital asset industry continues to operate without a definitive regulatory framework, leaving key questions unanswered about future rulemaking and legislative action.
Broader Context
The SEC had dated its original notice August 10. The commissioners had been due to decide whether to publish for comment a set of exemptions letting crypto startups raise capital without complying with traditional securities offering rules. A vote would not have created anything binding, only opened a proposal to public comment. The CFTC is proceeding with its own event, an inaugural meeting of its Innovation Advisory Committee on August 20 whose agenda opens with a session titled ‘Crypto’s Regulatory Evolution: From Uncertainty to Clarity’ and goes on to cover artificial intelligence and prediction markets. The CFTC’s meeting is advisory and produces recommendations rather than rules.
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