On 21 March 2025, at the opening session of the United States Crypto Task Force’s inaugural roundtable in Washington D.C., United States Securities and Exchange Commission (US SEC) Commissioner Caroline A. Crenshaw delivered the inaugural speech raising awareness and stressing on the importance of upholding the foundational principles of US securities law as the Commission explores the classification of crypto assets. The roundtable, themed “Defining Security Status” in respect of crypto assets and its classification in US, forms part of the US SEC’s Spring Sprint Toward Crypto Clarity initiative.
Commissioner Caroline A. Crenshaw framed the discussion around two critical questions: whether crypto assets fall within the definition of securities under existing US law, and whether they should. She welcomed the opportunity for reasoned policy debate and emphasised the importance of regulatory clarity being rooted in the US SEC’s scope of jurisdiction and to create an umbrella for investor security.
In the regulatory discussion, pointing out that the US capital markets is currently valued at over $120 trillion, and among the most ‘robust’ and ‘trusted’ in the world. That trust, she noted, is grounded in decades of regulatory infrastructure and jurisprudence, with the definition of “security” forming the cornerstone of the system. “We cannot poke holes in the foundation without expecting the walls may crack,” Caroline A. Crenshaw warned, expressing concern that weakening this definition to accommodate crypto assets could jeopardise broader investor protections.
While acknowledging the view that current legal frameworks may be inadequate for crypto, Caroline A. Crenshaw cautioned against creating a bespoke legal structure that carves out exemptions or dilutes existing protections. She posed a series of questions that should guide any proposal for reform among others are the following: ‘What statutory authority does the US SEC have to enact such changes?’, ‘Can clarity be achieved without undermining the flexibility of the existing legal definition of a security?’, ‘Will any proposed framework adequately protect investors, uphold market integrity, and address national security concerns?’, How can crypto assets be distinguished from other asset classes in a way that justifies special treatment?’, and ‘Will new frameworks provide equivalent protections and competitive neutrality?’. These questions will be dealt with in the future US Crypto Roundtables and are in view of US SEC’s statutory mandate under the United States Securities Act of 1933 and the United States Securities Exchange Act of 1934 along with other risks associated with crypto assets, including high volatility, widespread scams, limited legal recourse, and potential misuse for criminal activity.
(Source: https://www.sec.gov/newsroom/speeches-statements/crenshaw-remarks-crypto-roundtable-032125)
