Circle, the entity behind $USDC, is challenging the SEC’s sweeping assertion that most crypto assets fall under the category of securities.
Circle filed an amicus curiae in the SEC’s case against Binance, not to support Binance, but to tell the court: hey, those stablecoins ya’ll are talking about are not securities.
Read the amicus curiae brief here.
The Core Argument 🧠
Circle’s argument is crystal clear: the SEC lacks the authority to regulate stablecoins like USDC. Why? Because stablecoins, pegged 1:1 to the US dollar, fundamentally differ from the tokens the SEC previously classified as securities.
They don’t offer buyers any potential for profit based on the issuer’s efforts, making them more akin to asset sales than investment contracts.
SEC’s Overreach? 🕵️
Circle emphasizes the SEC’s newfound interest in stablecoins and argues against its overbroad or imprecise assertions of jurisdiction over them.
Circle urges the court to scrutinize the SEC’s novel claims of authority meticulously, ensuring that Binance’s BUSD offering indeed falls within the agency’s jurisdiction.
Legal and Economic Stakes 💰
Circle warns an overbroad grant of jurisdiction over stablecoins to the SEC could sow confusion and significantly impact a tool facilitating trillions of dollars in transactions annually, potentially harming the digital-asset industry and the U.S. economy.
Evaluation of Allegations 🧐
Circle suggests that the court should assess the entire transactional context surrounding Binance’s sales of BUSD while evaluating the SEC’s complaint.
Circle stresses that it is crucial to consider the allegations about the entire undertaking related to the BUSD sales and not just focus on BUSD as a standalone digital asset.
Circle’s Position and the Bigger Picture 🌐
Circle is here to aid the court’s consideration of the SEC’s allegations about $BUSD, emphasizing that payment stablecoins are an essential part of the digital-asset ecosystem and fundamentally different from tokens previously asserted as securities by the SEC.
Like most of these court related crypto events – we just have to hurry up and wait.