Publishes 10 Regulatory Principles to Guide Industry’s Regulatory Engagement
New York (April 20th, 2023) – Today CoinFund, a leading web3 investment firm, announces the publication of Better Technology, Better System, a whitepaper that outlines the way forward for crypto regulation in the United States with 10 clear regulatory principles. The paper is authored by Christopher Perkins, President of CoinFund, and Member of the CFTC’s Global Markets Advisory Committee (GMAC).
CoinFund’s whitepaper comes as the US crypto industry grapples with increasing regulatory action, including but not limited to the SEC’s Wells Notice to Coinbase and the CFTC’s recent suit against Binance.
The paper offers policymakers 10 concrete recommendations including calling for the regulation of centralized intermediaries but not decentralized technology and prioritizing sandboxes and safe harbor programs aligned with SEC Commissioner Peirce’s proposals. In addition, the whitepaper calls for regulation to focus on the following principles: client asset protection; risk disclosures; transparency; cost-efficiency; inclusivity; engagement, and privacy.
Speaking on the publication of Better Technology, Better System, Chris Perkins said, “The best way forward for the crypto industry is through reasoned and good faith engagement. The 10 principles in Better Technology, Better Solutions can guide us towards a path of responsible innovation where entrepreneurs have the certainty that they require to remain focused on building, growing the economy, and powering job creation.”
As part of CoinFund’s publication of Better Technology, Better Solutions, CoinFund encourages the crypto community to remain focused on proactive engagement with regulators and policymakers based on clear and realistic principles, outlined in the paper.
A full copy of the report can be found at Better Technology, Better System.
CoinFund is a web3 and crypto-focused investment firm and registered investment adviser founded in 2015. The firm invests in seed, venture, and liquid opportunities within the blockchain sector with a focus on digital assets, decentralization technologies, and key enabling infrastructure. The CoinFund team has studied and supported the development of the blockchain space from the inception of the first decentralized networks and come from diverse backgrounds in investing, engineering, law, and decentralized protocols. For more information, including a list of portfolio companies, please visit our website at coinfund.io.
A summary of SEC Commissioner Pierce’s Proposals:
In the statement, SEC Commissioner Hester Peirce proposes an updated version of the “Token Safe Harbor Proposal,” which aims to provide regulatory clarity for token issuers in the cryptocurrency industry. The proposal suggests a three-year grace period during which token issuers can develop their networks and communities without fear of SEC enforcement actions, provided certain conditions are met.
Some of the proposed conditions include:
Disclosure of key information about the network and token, including how it functions, how it is marketed, and how it is secured.
Implementation of measures to prevent fraud and manipulation, such as restrictions on the transfer of tokens during the grace period.
Notification to the SEC of the intention to rely on the safe harbor, as well as regular updates on progress and compliance.
Peirce emphasizes that the proposal is not intended to be a permanent solution but rather a way to foster innovation and encourage dialogue between regulators and innovators in the cryptocurrency space.