Attorney: Don’t Hold Your Breath on Token Taxonomy Act That Exempts Crypto from Securities Laws

This past December, cryptocurrency investors were delighted to hear that lawmakers had put forth a bill – aptly dubbed the “Token Taxonomy Act” – that would change the Securities and Exchange Commission’s 72-year-old definition of securities in order to exclude crypto.

If passed, this bill would entirely alter how the industry is regulated going forward and would offer companies and projects significantly more room for experimentation without worrying about regulatory authorities.

Although news regarding this bill was seen as being decisively positive, one prominent attorney who focuses primarily on blockchain and cryptocurrencies, is now claiming that investors shouldn’t get too excited about this bill.

Crypto Likely to be Regulated Under Securities Laws for Foreseeable Future

This bill was introduced to Congress in late-December by two lawmakers and is a bipartisan attempt to modernize the SEC’s archaic securities laws in order to exclude cryptocurrency from its framework.

Representative Warren Davidson, R-Ohio, made a statement at the time the bill was proposed, saying in-part that the bill’s primary goal is to ensure that nascent markets and technologies aren’t over-regulated, which could significantly stifle innovation.

“In the early days of the internet, Congress passed legislation that provided certainty and resisted the temptation to over-regulate the market. Our intent is to achieve a similar win for America’s economy and for American leadership in this innovative space,” Davidson explained.

Washington DC gridlock could lead to major delays in the Token Taxonomy Act being voted on.

US regulatory authorities have been slow to regulate the cryptocurrency industry, but the massive influx of neophyte investors into the crypto markets in late-2017 led the SEC to take an increased interest in the industry, and they have since been cracking down heavily on scams and uncompliant crypto-related operations.