Jeremy Allaire, CEO and co-founder of US crypto finance company Circle, claims that the largest obstacle in the cryptosphere today is the absence of clear definitions for crypto assets by the US Securities and Exchange Commission (SEC), particularly what is considered a security.
“The biggest and most immediate regulatory hurdle we face is the lack of specific guidance from the SEC on how to classify various crypto assets. We believe many are clearly currencies and commodities, and there needs to be more specificity on what are really securities. This can unlock a lot of market activity, and also clearly enable the growth of a market for crypto-based securities.”
Allaire’s remark comes in response to a question on Circle’s engagement with regulators posted in a Reddit thread which he recently started (Jan 10). He also stated his belief that there should be differentiated taxation for crypto-to-crypto transactions.
Turning to Bitcoin, Allaire predicted that the cryptocurrency will gradually appreciate far more in time to come compared to its value today, although he cautioned, saying:
“I do not think it’s winner-take-all. We have the phrase ‘the tokenization of everything,’ and we think cryptographic tokens are going to represent every form of financial asset in the world. There will be millions of them in years.”
The Reddit thread also sparked discussion in areas such as privacy-focused altcoins like Moreno (XMR), with many Reddit users interested in Circle’s strategy to tackle government scrutiny of such products.
Robert Bench, Circle’s CCO and head regulatory counsel, explained that Circle may take such assets into consideration for the risk assessments of their customers, given that there is no specific legislation on privacy coins in the US at present.
He added that he “wouldn’t underestimate the ability of smart industry and government participants to find solutions to provide transparency on these coins [in the future]”.