Key facts
- The SEC canceled a meeting intended to advance its crypto rulemaking and unveil an innovation exemption.
- The postponement is reportedly linked to concerns surrounding the Digital Asset Market Clarity Act.
- Industry sources suggest the SEC's actions could be complicated by ongoing legislative negotiations.
- The rulemaking process, including public feedback and finalization, could take up to a year.
- An additional year may be required for companies to comply with new regulations.
The U.S. Securities and Exchange Commission (SEC) unexpectedly canceled a planned open meeting last Friday, where it was set to discuss its proposed "Reg Crypto" rulemaking and unveil its long-delayed innovation exemption. The meeting's postponement, and the indefinite delay of the innovation exemption, are reportedly due to concerns surrounding the Digital Asset Market Clarity Act.
Industry participants had suggested that if Congress did not act on the Clarity Act before its August recess, regulators might step in. However, the SEC's decision to postpone its actions suggests that the White House and lawmakers are worried that any SEC move could further complicate ongoing negotiations over the Clarity Act, which is slated for a Senate vote next month. This situation implies that further regulatory action from the SEC may not occur until after the Senate reconvenes in early October.
The formal rulemaking process itself is lengthy, involving public comment, revisions, and finalization, which could take close to a year. Following this, an implementation period for companies to comply with the new regulations could add another year. This timeline brings potential new frameworks close to the next presidential administration, potentially making them easier to undo.