2 years ago
Companies listed successful the U.S. that enactment arsenic custodians of cryptocurrencies connected behalf of different companies should relationship for those assets arsenic liabilities and disclose the hazard associated with those assets to investors, the Securities and Exchange Commission said Thursday.
In its guidance, the SEC said the custody of integer assets connected behalf of others has risks not contiguous with different assets:
Technological risks – determination are risks with respect to some safeguarding of assets and rapidly-changing crypto-assets successful the marketplace that are not contiguous with different arrangements to safeguard assets for 3rd parties;
Legal risks – owed to the unsocial characteristics of the assets and the deficiency of ineligible precedent, determination are important ineligible questions surrounding however specified arrangements would beryllium treated successful a tribunal proceeding arising from an adverse lawsuit (e.g., fraud, loss, theft, oregon bankruptcy); and
Regulatory risks – arsenic compared to galore communal arrangements to safeguard assets for 3rd parties, determination are importantly less regulatory requirements for holding crypto-assets for level users oregon entities whitethorn not beryllium complying with regulatory requirements that bash apply, which results successful accrued risks to investors successful these entities.
These risks tin person a "significant impact" connected the custodian's operations and fiscal conditions, the SEC guidance said. Because of this, the risks should beryllium disclosed and the assets beryllium accounted for astatine just worth and listed arsenic a liability.
This communicative is processing and volition beryllium updated.
DISCLOSURE
The person successful quality and accusation connected cryptocurrency, integer assets and the aboriginal of money, CoinDesk is simply a media outlet that strives for the highest journalistic standards and abides by a strict acceptable of editorial policies. CoinDesk is an autarkic operating subsidiary of Digital Currency Group, which invests successful cryptocurrencies and blockchain startups. As portion of their compensation, definite CoinDesk employees, including editorial employees, whitethorn person vulnerability to DCG equity successful the signifier of stock appreciation rights, which vest implicit a multi-year period. CoinDesk journalists are not allowed to acquisition banal outright successful DCG.
Kevin Reynolds is Editor successful Chief astatine CoinDesk. He owns bitcoin, ether, polygon and solana.
Sign up for The Node, our regular newsletter bringing you the biggest crypto quality and ideas.
By signing up, you volition person emails astir CoinDesk merchandise updates, events and selling and you hold to our terms of services and privacy policy.
English (US) 