The Securities and Exchange Commission (SEC) met with industry players to discuss token standards and supported the issuance and transfer of compliance with tokenized securities.
The SEC’s Crypto Task Force met with organizations lined up at Ethereum on Thursday, including the ERC-3643 Association, ChainLink Labs, Enterprise Ethereum Alliance and Linux Foundation (LF) decentralized trust.
During the meeting, blockchain advocates and the SEC looked into how open standards like ERC-3643 and compliance frameworks such as Chainlink’s Automatic Compliance Engine (ACE) can help bridge on-chain technology with traditional regulatory requirements.
ERC-3643 is a token standard intended to be the basis for Ethereum Network’s compliant capital markets. Supported by the ERC-3643 Association, supported by companies such as ChainLink. ChainLink Ace is a smart contract-based framework for tokenized assets such as securities and real-world assets (RWAS).
sauce: Redwan Meslem
The SEC shows openness to industry standards for blockchain compliance
Dennis O’Connell, president of the ERC-3643 Association, told Cointelegraph that the SEC had shown significant changes in tone and approach during the meeting.
“The task force was extremely welcome, enthusiastic and motivated to lead the United States to leadership,” O’Connell told the Cointelegraph.
O’Connell said the SEC had demonstrated openness to industry-led standards during the meeting. He told the Cointelegraph that the task force had not previously considered the importance of open standards in blockchain.
“We have set our case for why, like in other industries, including traditional finance, we are expanding crypto in the US and enabling securities to become on-chain,” O’Connell added.
At the meeting, industry representatives presented suggestions on all the key elements of the regulatory framework for tokenized securities. This includes identity, compliance, registry, and control.
O’Connell told Cointelgraf that the task force has not taken a decisive stance on tokenized securities. He said he is “open to understanding how new blockchain technology meets identity, control and compliance concerns.”
O’Connell said the meeting was attributed to months of behind-the-scenes work and ultimately brought “a big step for the industry.”
He said the ERC-3643 Association and its partners plan to continue their engagement with the SEC Crypto Task Force and other US government agencies in the hopes that the US will catch up with global regulations and ultimately lead the adoption of capital market blockchains.
Related: Ethereum is scaling: TPS, gas is restricted as validator back to 45m target
SEC Chair Atkins on Boost Tokenization
The meeting was followed by positive comments from the head of the SEC, showing support for tokenization in the US.
On Friday, Bloomberg reported that SEC Chairman Paul Atkins was considering creating innovation exemptions within the framework to promote tokenization.
Atkin said the SEC is considering changes to promote tokenization, including exceptions that allow for new trading methods that support tokenized securities development.
“If we can turn it into a token, it will become a token,” Atkins said. They realized that asset movement towards the blockchain is inevitable.
magazine: Tradfi is building Ethereum L2 to tokenize trillions of rwas – Internal Story
Discover more from Earlybirds Invest
Subscribe to get the latest posts sent to your email.
