Venture capital firms urged SEC to exempt digital currencies from regulations: report

Venture capital firms urged SEC to exempt digital currencies from regulations: report
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Top venture capital firms reportedly asked the Securities and Exchange Commission (SEC) to exempt cryptocurrency-based tokens from their regulations.

Andreessen Horowitz and Union Square Ventures met with SEC officials on March 28, reports The Wall Street Journal.

They argued that government regulation could stifle innovation in cryptocurrency and blockchain.

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Lawyers from Cooley LLP, Perkins Coie LLP and McDermott Will & Emery LLP attended the meeting as wel, according to the Journal. The National Venture Capital Association  confirmed its attendance to The Hill.

The firms said that while they wanted exemptions and relaxed regulations, they had no issue with the SEC going after scams and other bad actors committing crimes with cryptocurrency.

But they specifically pushed for formal assurances that their products would be exempt from SEC oversight. They argued that digital tokens don’t function like securities for a company, but instead just give owners access to cryptocurrency projects.

SEC officials have expressed skepticism about giving such an exemption, the paper reported.

The plea comes after SEC Chairman Jay Clayton repeatedly warned that he would take steps to crack down on digital tokens and initial coin offerings — a popular fundraising method for cryptocurrency based projects.