Crypto custody at the SEC
Custody professionals showed up Friday at the SEC to urge the agency to create principled regulations around the business of safeguarding digital assets, while also urging it not to specify technological solutions.
Why it matters: Digital assets are bearer instruments, and the industry has had a lot of failures in terms of keeping those bearer instruments safe.
Between the lines: Custody is the core idea of cryptocurrency.
Before Bitcoin, there was no way for an individual to hold value digitally on their own.
The big picture: Very few investors want to hold these assets themselves, however. Especially gigantic, heavily regulated investors.
Between the lines: The fact that not all digital assets are under the SEC's purview is going to complicate rulemaking: The SEC only has authority over securities, and it looks likely that very few digital assets will be securities in the end.
Which could mean that there's two different rules for safeguarding assets that — from a custodian's perspective — are basically the same.
Friction point: One issue that seemed to spark some dispute on the panel was how customer assets should be segregated. They could have all the funds mixed but the separate amounts logged in off-chain accounts, or they could constantly rebalance between thousands of individual wallets.
Mark Greenberg, Kraken vice president, argued that mixing is less prone to security lapses. "The less crypto moves around, the less people have to approve things [and] move it around the better."
Though others pointed out that this raises issues with dealing with the external world.
What we're watching: Only one panelist was there to speak for self-custody, the concept invented with Bitcoin, where a person can steward their own assets.
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This press release does not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. About Venus Concept Venus Concept is an innovative global medical aesthetic technology leader with a broad product portfolio of minimally invasive and non-invasive medical aesthetic and hair restoration technologies and reach in over 60 countries and 9 direct markets. Venus Concept's product portfolio consists of aesthetic device platforms, including Venus Versa, Venus Versa Pro, Venus Legacy, Venus Velocity, Venus Viva, Venus Glow, Venus Bliss, Venus Bliss MAX, Venus Epileve, Venus Viva MD and Venus Concept's hair restoration systems include NeoGraft® and the ARTAS iX® Robotic Hair Restoration system. 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