The U.S. Securities and Exchange Commission (SEC) has released a statement directing companies that are, by law, bound to disclose their affairs to also, while at it, notify them should they have a working business relationship with crypto firms. This is obviously a result of the tentative approach and wariness people now have towards the crypto industry.
Declare Your Relationship With Crypto Firms
Since the fall of the popular crypto exchange FTX, many other events have taken place in the cryptocurrency era, most of which are quite deplorable.
As it is, many experts have predicted that the end of cryptocurrency is near, and a number of those that still believe in it think that it is too volatile for it to be the backbone of important economic decisions.
To this respect, many have clamoured for the regulation of the crypto industry worldwide, and as such, it came as no surprise when yesterday, on the 8th of December 2022, the U.S. Securities and Exchange Commission (SEC) publicly gave a directive to listed companies to disclose their relationships with crypto firms if they meet certain criteria, no matter how minute.
As a matter of law, the SEC is empowered to direct companies to make disclosures to ensure that the interests of their investors remain protected, but it has not included the crypto industry. However, considering that crypto is the new normal and taking note of the recent bankruptcy cases in society, it appears that the SEC’s decision was quite necessary.
Are Your Crypto Firms Under This Category?
The SEC has listed four requirements that would guarantee that companies would notify the body of their relationships with crypto firms.
They include when it is on the verge of bankruptcy, has issues with withdrawals of customers’ funds, cannot account for the customers’ funds, and is experiencing compliance difficulties.
The SEC has released a template to be used when making such disclosures, and people have largely interrupted the direction as a way to ensure that company involvement with crypto firms is limited to the barest minimum, if not eradicated.
And that may be perfectly true, considering the tight leash that has been put around the necks of crypto firms in the industry recently. It appears that crypto might forever have to condone heavy regulations.
At Tokenhell, we help over 5,000 crypto companies amplify their content reach—and you can join them! For inquiries, reach out to us at info@tokenhell.com. Please remember, cryptocurrencies are highly volatile assets. Always conduct thorough research before making any investment decisions. Some content on this website, including posts under Crypto Cable, Sponsored Articles, and Press Releases, is provided by guest contributors or paid sponsors. The views expressed in these posts do not necessarily represent the opinions of Tokenhell. We are not responsible for the accuracy, quality, or reliability of any third-party content, advertisements, products, or banners featured on this site. For more details, please review our full terms and conditions / disclaimer.