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‘SEC Needs to Make Up Its Mind on Crypto Or Risk Brain Drain’

May 30, 2019 13:28
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On Wednesday, we reported on how the messaging app Kik, which has launched their own digital token called Kin, was mulling on taking the Securities and Exchange Commission (SEC) to court.

The campaign known as Defend Crypto stated, “In January 2019, Kin came out publicly to share what has been going on behind the scenes with the Securities and Exchange Commission (SEC). This has been a burden for not just Kin, but many others in the space who are optimizing for regulation before innovation. Everyone is always asking “what will the SEC think?” instead of “what is best for consumers?”

It further added that, even though 300,000 people use Kin as currency, the SEC thought that Kin was a security. It said, “After months of trying to find a reasonable solution, Kin has been unable to reach a settlement that wouldn’t severely impact the Kin project and everyone in the space. So Kin is going to take on the SEC in court to make sure there is a foundation for innovation going forward.”

Now, Jose Maria Macedo – Head of Advisory at Amazix and tokenomics advisor to the San Marino Scientific Council – has weighed in on the matter.

Macedo told Crypto-News India, “The SEC finds itself between a rock and a hard place. If it’s too lax on flagrant securities violators, including dubious ICOs, it faces flak for not doing its job. If it’s too heavy-handed, however, it risks stifling regulation. Right now, there’s a growing consensus that they’re leaning towards the latter, with a lack of regulatory clarity leaving crypto projects in the dark. If they don’t act soon to clarify the status of crypto assets, most of which clearly don’t qualify as securities, we could see a ‘brain drain’ as crypto companies flee the US in favor of territories that have welcomed digital currencies, recognizing that these are new instruments which cannot be defined using legislation that was enacted 75 years ago. Nations like San Marino and Malta are capitalizing on the void left by the US, enacting laws that foster innovation and welcome compliant crypto startups.”

While this comment doesn’t defend either party explicitly, it does pose the serious threat of brain drain, which ultimately is a huge loss for any country. Hopefully the SEC will take a decision, which will help the companies to remain in the US.

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