SEC Chair on Facebook’s Libra Cryptocurrency Project: Innovation Won’t Trump Securities Laws
Facebook is still trying to carve the path for the launch of its new Libra token, but there are a lot of people in its way. The chairman of the U. S. Securities and Exchange Commission (SEC) Jay Clayton is one of these people.
Clayton a was skeptic of the crypto market ever since people started Initial Coin Offerings (ICOs). Now, he will be a problem for Facebook, as he is very suspicious of it as well. Ever since Facebook announced its new token, regulators from all over the world are calling out the company and investigating its every move in order to determine if the new token would be compliant and safe.
Obviously, Facebook wants to avoid the SEC at all costs. David Marcus, a representative from the company, has recently affirmed that Libra would not fall under the jurisdiction of the SEC because it was more akin to cash than security.
The lobbying campaign of the company is trying to do the same, get as far as they can from the SEC, as they fear it may sink their product. No one from the company has talked to the SEC yet and it could certainly spell trouble if the token was regulated by them because the launch would be delayed in several months if it ever happened.
Clayton often declined to comment directly on Facebook’s new product but he affirmed that anything that looks and operates like a security of exchange-traded fund (ETF) has to be regulated this way. And, according to some people, Libra seems a lot like an ETF.
It looks like Facebook’s luck will depend a lot on whether the SEC decides to go after it or not. If they start to dig deeper, Facebook’s Libra will probably have a rockier launch than most executives of the company expected.