Regulation
SEC halts Stacks investigation, signaling regulatory changes in cryptocurrency industry
The crypto community has won another significant victory against the U.S. Securities and Exchange Commission (SEC), as the regulator halted its investigations into Stacks, a major layer-2 Bitcoin network.
On July 12, Stacks developer Hiro Systems revealed that the SEC had informed it on July 9 of the decision to end the investigation. Hiro had raised $70 million from token sales between 2017 and 2019.
SEC Drops Investigations into Stacks
In his letterThe SEC’s enforcement division said it would not recommend any enforcement measure against the company. However, the notice clarifies that this decision should not be considered an exoneration or a guarantee that future actions will not arise from the investigation.
Muneeb Ali, a board member at Hiro Systems, said the outcome was the best a company in the industry could hope for, but that U.S. regulation still needed to be improved. He noted that Stacks had conducted the first-ever SEC-qualified offering in 2019 and had become decentralized before its mainnet launch in January 2021. Despite this, the SEC began its investigation in July 2021.
“We need a regulatory system that meets the needs of innovative open protocol creators. We will continue to work with policymakers and developers to make this happen. The closure of the Stacks investigation gives us hope for a bright future for decentralized technologies for Bitcoin and the next-generation internet,” Ali said. declared.
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The SEC’s decision has outraged the crypto community, noting that Stacks’ compliance efforts have not shielded it from scrutiny. Billionaire investor Mark Cuban noted that while the SEC’s decision is positive, it still poses risks for projects that aim to work closely with the regulator.
“If you needed further confirmation of the SEC’s insanity… It’s not that they dropped their investigation… It’s crazy because Stacks was one of the VERY FEW tokens that went through the approval process to raise money with their token in 2019,” Cuban said. commented.
Stacks STX Price Performance. Source: TradingView
Meanwhile, the move comes during an important week for Stacks STX Tokenwhich has seen an increase of almost 20% increase compared to the past seven days. According to BeInCrypto, it is trading at around $1.7 at press time.
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This is the second cryptocurrency-related investigation dropped by the SEC this week. On July 11, Paxos announced that the SEC has decided not to take any enforcement action regarding its investigation into the Binance USD (BUSD) stablecoin.
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