Ethereum's Regulated Boost: Understanding the Cause Behind Its Surge
🤘 ** SEC Cranking Up the Decentralized Finance Game 🤘**
The U.S. Securities and Exchange Commission (SEC) is shaking things up in the crypto world, especially with its newfound love for Decentralized Finance (DeFi), pleasing Ethereum investors.
Chairman Paul Atkins, leading the charge, has made it clear at a recent crypto regulatory roundtable that DeFi aligns with American values such as economic freedom, property rights, and innovation. He expressed concern over antiquated regulatory frameworks trying to fit self-governing systems as if they were the rulebooks of the 20th century.
DeFi Tokens Minting, Validating, and Wallet Development - Green Light
Atkins has signaled that mining, validation, or staking services in proof-of-work and proof-of-stake networks, typically associated with DeFi tokens, are not subject to federal securities laws. He also made it clear that users should be able to store their digital assets in their own wallets, and that staking codes or wallet software shouldn't be classified as intermediary services. The SEC commission staff is expected to prepare guidance for blockchain-based companies and update regulations accordingly, fueling the growth of self-custody and open-source infrastructure for DeFi.
Atkins has even proposed a "sandbox" framework to accelerate the introduction of decentralized financial products to the market, aiming to make the U.S. the hotspot for crypto innovation. This fresh approach seems to reflect President Donald Trump's vision of making the U.S. "the crypto capital of the world."
Ethereum - A Step Closer to Global DeFi Dominance
Ethereum has strongly benefited from this regulatory easing, with an impressive 55% market share in the DeFi sector, totalling $68 billion in total value locked. Eric Conner, a former Ethereum developer, listed the clarity provided by these decisions, particularly around self-custody, open-source infrastructure, and staking, as a significant boost for Ethereum. He expressed optimism that the U.S. could emerge as a leader in crypto technology if these policies are implemented.
Post-meeting, Ethereum's price rose by 8% from the $2,500 level, but hitting the $2,800 resistance four times in the last month has caused Stakers Demonum to reel back. Breaking this resistance is key for a sustained upward trend.
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*Details**
- [1] Coindesk - SEC Drops Plans for DeFi Oversight, Anticipates 'Significant Progress' on Crypto Rules: https://www.coindesk.com/policy/2021/05/27/sec-drops-plans-for-defi-oversight-anticipates-significant-progress-on-crypto-rules/
- [2] Cointelegraph - SEC's Atkins Suggests Opening Sandbox for DeFi: https://cointelegraph.com/news/sec-s-atkins-suggests-opening-sandbox-for-de-fi
- [3] Decrypt - SEC's Paul Atkins Plans to Make DeFi Regs a Whole Lot Easier: https://decrypt.co/82898/sec-paul-atkins-plans-ease-defi-regulations
- [4] DeFi Llama - https://defillama.com/
- [5] Coindesk - SEC's Atkins Says Current Crypto Rules Too 'Mechanistic', Could Lead to Innovation Exemption: https://www.coindesk.com/policy/2021/11/12/sec-s-atkins-says-current-crypto-rules-too-mechanistic-could-lead-to-innovation-exemption/
- In light of chairman Paul Atkins' statements, technology playing a significant role, particularly in proof-of-work and proof-of-stake networks associated with DeFi tokens, may not be subject to federal securities laws when it comes to mining, validation, or staking services.
- The SEC's potential "sandbox" framework, proposed by Paul Atkins to accelerate the introduction of decentralized financial products, may attract further investment in technology, contributing to the United States becoming a global leader in decentralized finance (DeFi).
