- Deaton added that it is directed to help the incumbents to win a major share of the industry.
- The lawyer added that more exchanges have received or would receive the SEC’s Wells Notice.
John E Deaton, the lawyer and Managing Partner of the Deaton Law Firm shared his convictions on the Securities and Exchange Commission’s (SEC) war against crypto as a strategic move towards helping the “incumbents get a major share of the industry”.
Today, Deaton commented via his official Twitter page that SEC’s recent Wells Notice against the leading crypto exchange Coinbase was also an example of the tactics of the agency.
Notably, the lawyer added that Coinbase is not the only target of the SEC, but even more exchanges including Kraken, Binance, and Binance.US are also targeted; these firms have received or would receive the Wells Notice soon.
Previously, on Thursday, the SEC issued an alert warning investors to be cautious while investing in the firms offering crypto asset securities as they may not be complying with US laws.
Interestingly, the SEC announced in a bulletin, that the exchanges are advised to register with the SEC or other self-regulatory organization, adding:
The law requires parties such as securities broker-dealers, investment advisers, and exchanges to register with the SEC, a state regulator, and/or a self-regulatory organization. Moreover, entities and platforms involved in lending or staking crypto assets may be subject to the federal securities laws.
As a response to the SEC’s new scheme, Deaton commented acknowledging it as “scare tactics”. He added that it would cause damage to the crypto space and help the office-bearers in return.
Significantly, he noted the list of the financial assets that the 1934 Securities Act excluded, like the “token, digital asset, alphanumeric code or software code”. In addition, he went on to explain the term “investment contract” and the “Howey test”.