SEC’s Crypto Regulation Flawed, Says Paradigm

• Paradigm, a web3 venture capital firm, has published a policy paper criticizing the US Securities and Exchange Commission’s (SEC) crypto industry regulation.
• The paper argues that the SEC’s approach to crypto assets is flawed and fails to provide essential information to users and investors.
• Paradigm urges the SEC to modify its current disclosure framework to accommodate new technologies and asset classes.

Paradigm Criticizes SEC Approach To Crypto Regulation

Paradigm, a Web3 venture capital firm, has published a policy paper criticizing the US Securities and Exchange Commission’s (SEC) crypto industry regulation. The paper argues that the SEC’s approach to crypto assets is flawed and fails to provide essential information to users and investors.

Outdated Regulatory Framework for Crypto Assets

The current disclosure policy was developed in the 1930s and is outdated, according to Paradigm. It was designed “for centralized companies issuing securities” whereas the crypto market is fundamentally different. Most cryptocurrencies provide technological capabilities within a protocol rather than legal rights, which can operate autonomously without assistance from their issuers.

SEC Policies Criticized by Other Industry Representatives

Several other crypto industry representatives share Paradigm’s critique of the SEC’s policies. In February, stablecoin issuer Circle CEO Jeremy Allaire noted that the SEC is not the right institution to regulate stablecoins. Warren Davidson, a congressman also criticized the agency’s policies on April 16th when he proposed legislation to replace Gensler with an executive director who reports to the board.

Paradigm Urges Changes To Disclosure Framework

In its policy paper, Paradigm urges changes in order for effective regulation of crypto asset markets without significant changes in its current disclosure framework so as accomodate new technologies and asset classes while giving users and investors essential info they need or provide entrepreneurs with viable path for compliance .

Conclusion

The company believes that it is important for regulators like SEC understand how trading works in order for them make appropriate regulations that would be suitable for digital assets marketplace . Therefore , it calls upon them update their laws accordingly .