LIVE NOW: America First Policy Institute Holds Event Featuring SEC Chairman Paul Atkins
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Yahoo
6 hours ago
- Yahoo
Crypto regulation: SEC Chair Atkins previews the agency's efforts
Under the Biden administration, many in the crypto community were frustrated with how they were being treated by the Securities and Exchange Commission. That frustration turned into hope when President Trump picked Paul Atkins to lead the agency. Chair Atkins sits down with Yahoo Finance Senior Reporter Jennifer Schonberger to discuss some of the things the SEC is working on to when it comes to crypto. To watch more expert insights and analysis on the latest market action, check out more Market Catalysts. Director Atkins, thank you so much for sitting down with me. It's wonderful to have you on Yahoo Finance. Thank you very much. It's great to be here. I think this is my first time on Yahoo Finance. And hopefully the first of many appearances. I'd be happy to come back. Thank you. The President's working group on Digital Assets has directed the Securities and Exchange Commission to immediately enable the trading of digital assets at a federal level, specifically asking for greater clarity on trading, custody, registration. Could you offer more details on what we could expect to see in terms of customized rules for crypto from the SEC? Well, thank you. That's a a great topic and uh you know, I could go on for hours on that one, but uh because it's complex and we are taking a new uh path than what's been done before here at this agency. But basically, what we've done is establish uh a crypto task force and that started back in uh as soon as inauguration happened with my colleague uh Commissioner Hester Peirce uh was leading that. And so now we are formalizing that task force into what we're calling project crypto. So mobilizing the full uh extent of the SEC's uh staff here in the various uh rule making divisions to start uh putting together proposals to go to the public uh and and make proposals as far as uh making rules more streamlined and fit for purpose with respect to the crypto world. So it stems from initial registration and and how or how intermediaries are registered or not and how they can deal with crypto assets. During the last administration, I heard routinely from crypto companies how difficult it was to just merely register with the SEC. How could we see that change? What does the path to registration look like for crypto companies? Can you offer any insight into how that would change? Well, I think that the the trouble was in the past, uh the SEC didn't make any accommodations for things that clearly don't fit with respect to either a crypto company, crypto-related company, so like a broker dealer equivalent, one who's trading crypto assets or the assets themselves. And so there are many questions and it was just hard for crypto companies to shoehorn into a set form that's been around for decades and decades. So you know, kind of fit for purpose for an industrial era, but not necessarily for a digitized uh company or digitized assets. So we're out to make that. Our goal is to make that clearer. So there's no more question and people don't have to try or try to have their lawyers interface with SEC, if lawyers don't get any answers, so they can't give an opinion to their client as to how to go forward. So we want to cut through all of that and make things, you know, very straightforward so that people have certainty. And so innovators need certainty in order to bring their products to market because the because investors who are interested in investing in that innovation need and have certainty that everything is legal and that it's not going to get tied up in litigation or lawsuits or whatever. What about the custody side? Can you offer any details on what changes we could see there? Well, with that, we will uh we have certain authority on our own respect to investment advisors and and whatnot. But generally, we will be working with our colleagues at the bank regulatory agencies um and with the states to get some, you know, set rules down that then are consonant with the rules that apply that are in statute right now. We can we have authority to interpret those statutes um uh to to make them fit for purpose for the current environment. So I look forward to working with the bank regulators as being outlined in that PDVG report. And how quickly could we see these rules implemented? What's the timeline on this? Well, we can do some things uh just uh, you know, through the normal course um but uh but for to have to make sure that things are stable for the future and, you know, not still in question, um we will go out, we have to have rule proposals that go out for notice and comment from the public uh and to make sure that we've gotten it right, which is just the best way to do things obviously rather than, uh, you know, go ahead and shoot first and then ask questions later. You want to ask questions first and have people give input to make sure things are are correct and there are no loopholes in it or whatever. So that process will take a while. So people shouldn't think all this will happen here in the next two months, but well, we're going to start, we've been working on this for a while. We'll be start uh starting to roll out proposals and here this year within the next few months. And so it will proceed a pace into the next year and perhaps into the following year, but you'll start seeing things come out. Last month, you said you're considering an exemption for innovations to help companies who want to experiment with moving stocks onto the blockchain. Subsequently, we heard from your colleague, SEC Commissioner Hester Peirce, who sent a statement that tokenizing a security creates a token that is a security. So could you offer a bit of clarity there? What can we expect if stocks are trading on the blockchain are are tokenized? Will securities laws that are still on the books apply? Well, as as Commissioner Peirce said, I mean we the way the law is written now, we'll see how that develops with Congress, but the tokenization of securities uh just in is a wrapper around the security itself. So that's still in most cases uh probably would be a security. But we need to have again to get back to clarity, we need to have um, you know, set out straightforward rules so that people can see like, okay, is this a commodity, is this a security? And then if it's a security, then what do I need to do to make sure that I can issue it and that it can be traded properly under the law. The blockchain adds so much advantages to some of the other um aspects of the current financial system, but part of that is transparency. You know, on the blockchain, you can follow the transactions back to inception. And so there's uh because of that openness, I think we can use that as a as a lever to to help uh, you know, make sure that things are consonant with the securities laws. So just to clarify, if a stock is tokenized, the securities laws that are still on the books would comply, what would apply rather. Those those those stocks would still be governed by the current securities laws. Right. I don't think that we we will study this and and make sure that, you know, we can have a straightforward answer. But a lot of times, there are different ways to tokenize things. And so some of that will be um, you compare it to say a mutual fund or an ETF. So the ETF is still a security even though and it has securities also in it. It's a basket of securities. So that's the similar thing with the tokenized um asset. And so, so but we need to make sure that that the rules that apply for disclosure and issuance and all that can accommodate, you know, the special features of tokenization. And it's much more efficient perhaps to have a tokenized security than some other sorts of things, but we need to make sure that we have a level playing field that people are certain uh how to go forward. So that's going to be unfolding as we address these issues. Related Videos Bad news flurry, IPO market, crypto dive: Market takeaways Trump Moves Two US Nuclear Submarines on Russia Threat Trump says new tariff rates are final, but people are skeptical SEC chair talks tokenization & how securities should be defined Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
6 hours ago
- Yahoo
SEC chair talks tokenization & how securities should be defined
The Securities and Exchange Commission under President Trump is embracing the crypto industry in a way the Biden administration didn't. In the video above, SEC Chairman Paul Atkins speaks with Yahoo Finance Senior Reporter Jennifer Schonberger about tokenizing securities, how the SEC may look at how a security is defined, and how the agency wants to repeal rules that could be inhibiting innovation. Be sure to check out the first part of Schonberger's interview with SEC Chairman Paul Atkins. To watch more expert insights and analysis on the latest market action, check out more Market Domination. A lot of times when they are different ways to tokenize things, and so some of that will be, um, you compare to say a mutual fund or an ETF. So the ETF is still a security, even though it, and it has securities also in it. It's a basket of securities. So that's the similar thing with the tokenized asset. And so, so, but we need to make sure that that the rules that apply for disclosure and issuance and all of that can accommodate you know, the special features of tokenization. And it's much more efficient, perhaps, to have a tokenized security than some other sorts of things. But we need to make sure that we have a level playing field that people are certain how to go forward. So that's going to be unfolding as we address these issues. And how do you ensure that investors are going to get the best price if stocks are trading on the blockchain? Well, I think the markets will accommodate that. I mean, obviously, with actively traded things, you have very straightforward. Well, you have the opportunity for current valuation. That's, again, because of the way the blockchain works. And that's a transparent aspect. So, as the current financial system then adapts to accommodate these new forms of securities, I think there'll be, just like we have now, you know, national best bid offer prices and all of that. I think that we'll make, we will make sure that new forms of securities will mesh in with the rules, and that the rules will accommodate that sort of trading and that openness and, and the publicity of the prices. You're calling for on-chain markets. What exactly are you calling for there? Do you want all securities to be tokenized? Perhaps. I mean, you know, the when you look at the whole arc of history, so in the 1960s, um, things were still in paper form, paper securities, and there was so much trading in this big bull market at the end of the 1960s that the New York Stock Exchange and other exchanges had to close for one day a week just to catch up on the paperwork and because the data processing couldn't accommodate things. And so, and then sometimes two days a week because the volume was so heavy. Uh, and it's not that they had quill pens to write in the ledger to, you know, show the transfer of stocks, but, you know, they had to build the systems to accommodate all that. The SEC at the time helped the industry through helping them change the rules so that they could immobilize securities, have book entry, the depository Trust and Trading Corporation came about, which is a cooperative of securities firms to try to do that book entry transfer of stocks. So that was a huge watershed. So I think we are perhaps at a similar point now where who knows how this technology will develop. I certainly don't have a crystal ball. Five years from now, it could be completely different. So we want to be in a good place where we're accommodating that. We're not an impediment to innovation. Under the last administration, the Howey test was used to administer whether a crypto asset was a security or not, and it was deemed that most crypto assets were considered securities. I know you are of the opposite school of thought that many crypto assets are not considered securities. Is the Howey test germane in your view at this point? Is it applicable, or is the SEC looking at creating a brand new yardstick to create a clearer definition for what defines a security or not? Well, great question. The Howey Test is named after a Supreme Court case back 80 years ago. It had to do with orange groves and oranges. So that's completely different than tokenized securities or tokenized assets. And so what we have to do is, uh, it was a Supreme Court ruling, so that's the law of the land. It interpreted the term investment contract, which is in the securities laws, but Congress in that, in those laws, didn't define that. So thus, the Supreme Court took a stab at it, that worked for that one particular case, and has been applied, you know, for years after. So now we're, we're now in the 21st century, so and dealing with digital assets. So the SEC has authority to, um, to interpret that term. And so we are going to set out to have rules that comply with the law, and obviously build upon that, and to help people understand how that applies to the current situation. You said in a speech yesterday that in the coming months, the SEC will consider using authorities to make sure that any archaic laws that are squelching innovation and entrepreneurship are revoked. What could we see stripped away? Well, that's a good question. I don't want to prejudge anything, so we're going to have to do this in a very straightforward and diligent manner, obviously. But there are a lot of things that apply to, say, operating companies, like a steel company or something like that, that's manufacturing steel that doesn't apply to maybe a digital oriented company. And so as far as the products go, and whether or not those particular products themselves need to be registered as securities or not. So again, so we need to make sure that the forms that people need to fill out in order to declare and publicize to the SEC and to the public what their product is, what it's supposed to do, what the innovation is, or what the purposes, so that, you know, our rules can accommodate those particular aspects of these new products. Switching gears a bit. Investors who are eagerly anticipating the proposed Truth Social Bitcoin ETF are going to have to wait because the SEC has apparently postponed a decision on that until September 18th. Could you tell us why the delay? Are there any concerns there, or what's going on? No, it's part of the normal process of deliberation internally, so it's an active matter, so I can't really comment on it. But just to caution people that, you know, just because there is a temporary pause in that, that doesn't mean that it's not going to be deemed effective ultimately. So, anyway, so this is a normal process. You look at, you know, the other products that come. So there's, you know, we're going to get through that. And, you know, have announcements to come. And before I let you go, Mr. Chairman, you have said that you want to make IPOs great again. Yeah. What can we expect in terms of rule changes that would incentivize more IPOs? Well, today there are about half the number of public companies than there were 30 years ago even. And so even broad measures of the number of companies out there, like the Wilshire 5000. Unfortunately, now there are only about 3,000 companies in that. And so one friend of mine said we should rename it the Wilshire 3000 or something. But anyway, um, we we need to address like three major things that I view as inhibitions for people to want to take their company public because there's such a huge reservoir of private capital out there now that companies, developing companies can tap into that we want to make the public markets attractive. So one is litigation, two is abuse of the corporate governance system, I think. And then three, which is something that we can especially affect here at the SEC, is the amount of disclosure and of really not material information that we're asking many companies, in many cases, to disclose. And that, so we will have a spring cleaning, I like to call it, deferred maintenance that for way too many decades. And so we need to go back to, if you look at disclosure from companies 40 years ago or more, I mean, it's markedly different today, much, much more, and, you know, 10Ks are, you know, hundreds of pages long at times. And that's just intimidating for normal investors to get through because we've lost our north star of materiality. So we will go back to that, and then that will be the lens through which we look at our rules. Related Videos Bad news flurry, IPO market, crypto dive: Market takeaways Trump Moves Two US Nuclear Submarines on Russia Threat Trump says new tariff rates are final, but people are skeptical Princeton's Blinder Weighs In on Kugler, Jobs and Rates Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
6 hours ago
- Bloomberg
Berkshire Hathaway Sells $1.21 Billion of VeriSign Shares
Berkshire Hathaway and Warren E Buffett reported an insider transaction in VeriSign Inc. stock to the US Securities and Exchange Commission. Here are the details of the filing:
