- The IAC’s report suggests that 44% of Americans who own crypto are people of color.
- The SEC may regulate all crypto as securities and pursue aggressive enforcement.
“Crypto is racist,” quips Charles Hoskinson, the founder of proof-of-stake (PoS) blockchain, Cardano (ADA), in response to a comment from an advisory committee of the US Securities and Exchange Commission (SEC).
In a recent letter, the Investor Advisory Committee (IAC) asked the SEC to treat all crypto tokens as securities and pursue aggressive enforcement. Gabriel Shapiro, the General Counsel at Delphi Labs, started the conversation on Twitter, quoting the IAC to have said crypto poses a risk to investors and harms racial minorities.
This development has sparked a debate about the potential impact of the SEC‘s regulatory approach on the crypto industry and its investors. While some argue that increased regulation is necessary to protect investors, others worry that overly aggressive enforcement could stifle innovation and growth.
Additionally, some critics have expressed concern that the SEC did not engage with minority investors or their representatives for their opinion before making those recommendations. Legal experts such as Professor Tonya Evans have pointed out that communities of color could miss out on a significant wealth-building opportunity if excluded from crypto under the guise of ‘protection.’
Notably, the April 6 letter from the IAC to the US regulator read in part:
Nearly 44% of Americans who own and trade crypto are people of color, 41% are women, and more than 35% have household incomes under $60,000 annually.
The letter also highlighted that crypto investors had lost over $2 trillion from last year, given that the market crossed $3 trillion during its all-time high.