Jay Clayton will conclude his term at the end of the year as head of the SEC. This was announced by the Securities and Exchange Commission. 

As a result, a difficult transition begins for the US agency. If Jay Clayton is the one who most of all has found himself in the middle of the cryptocurrency boom, his successor will be responsible for decisions that will make the adoption of cryptocurrencies (or not) within reach of retail and institutional investors.

Jay Clayton and the SEC against ICOs

In fact, the same SEC press release recalls that it was under Jay Clayton’s leadership that the Securities and Exchange Commission faced one of the consequences of the crypto industry’s speculative bubble: the ICO boom in 2017. 

It states that:

“Beginning in 2017, U.S. capital markets experienced a sudden proliferation of initial coin offerings (ICOs), products that, while potentially representing new frontiers in finance, also attracted substantial fraudulent activity”.

And in fact, the SEC led by Clayton, with the help of ad-hoc divisions such as the Cyber Unit, fought against ICOs that violated federal law, as well as attempting to shed light on the market with a series of “measured yet timely actions”.

This battle left outstanding victims in the field. It is enough to think of Telegram, which was fined an impressive $18.5 million. In fact, the ICO of the Gram token would not have respected US regulations. The battle was so bitter that Telegram gave in and gave up both the TON blockchain project and the Gram launch.

Even Kik, who had launched an ICO with a token, Kin, for a messaging application, had to give up because of the stakes imposed by the SEC. A story that only recently ended with a $5 million fine for Kik.

Clayton’s SEC has also held back the approval of Bitcoin ETFs. The SEC, however, prides itself on having built, under its latest chairman, a robust framework for launching certain types of ETFs that promote innovation and competition. Bitcoin ETFs are lacking, which have not found a place even in this 2020 that is coming to an end. Clayton himself said no to these products. It was 2018, and two years didn’t change his mind.

The SEC at a turning point? 

In his message thanking President Trump for choosing him and all his internal and external staff, Jay Clayton pointed out:

“Working alongside the incredibly talented and driven women and men of the SEC has been the highlight of my career,” said Chairman Clayton. “I am proud of our collective efforts to advance each part of the SEC’s tripartite mission, always with an eye on the interests of our Main Street investors. The U.S. capital markets ecosystem is the strongest and most nimble in the world, and thanks to the hard work of the diverse and inclusive SEC team, we have improved investor protections, promoted capital formation for small and larger businesses, and enabled our markets to function more transparently and efficiently”.

It will now be up to the next chairman of the SEC to continue where Clayton will leave off. It will be his successor who will also have to bring about a change for the cryptocurrency industry, which certainly can no longer be ignored.

 

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Jay Clayton leaves the SEC: his battle against ICOs

by Matt Villie
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