The U.S. Securities and Exchange Commission (SEC) took one small step backwards in regulating the crypto sector on Wednesday, when it erased what would have been its first formal definition of “digital asset” from its latest hedge fund rule.
While the SEC had initially included the definition in its 2022 proposal to overhaul mandatory disclosures for hedge funds, the securities regulator yanked it in the final rule approved by the commissioners. The agency included a footnote to explain itself:
“The commission and staff are continuing to consider this term and are not adopting ‘digital assets’ as part of this rule at this time,” the note declared.
Source: U.S. SEC Changes Its Mind on Officially Labeling Digital Assets in Hedge Fund Regulation