Recently, the SEC introduced new rules regarding private fund managers. Knowing that the activities of this sector also include cryptos, the decision has caused concern among the crypto community. According to some experts, the crypto industry would not be threatened by the new regulations.
In short
- The new SEC rules worry the crypto sector, but their impact would be limited according to experts.
- Adam Guren, co-founder of Hunting Hill Digital, believes the requirements will not weigh heavily on crypto firms.
- Several hedge funds accuse the SEC of overstepping its mandate.
New requirements not too onerous for firms
True to its aggressive regulatory policy, the SEC recently adopted new financial rules. These particularly concern the ecosystem of hedge funds that are active in the crypto sector.
Considering the commitment of these private investment vehicles to the crypto industry, the new SEC rules attracted attention. Several analysts and experts were particularly concerned about the potential effects of the financial measures taken by the regulator.
Although legitimate, this concern is unfounded according to Adam Guren, co-founder of Hunting Hill Digital. The head of this crypto-focused alternative asset manager believes the new requirements should not be too burdensome.
This is especially true for companies that use transfer fee structures. These are companies setting up pricing mechanisms to move funds from one location to another.
More concretely, these companies design fee structures to charge costs associated with these transfers. An activity which is typical of crypto firms offering transfer or digital asset management services.
The concern of crypto investors can therefore be explained from this point of view. And it is entirely legitimate since the SEC reforms nevertheless involve some risks.
A slight risk all the same for crypto companies
It is true that according to Adam Guren, the SEC reforms do not threaten the interests of asset managers. However, the expert tempers his point of view. This, by raising a risk which still weighs on the activities of crypto firms.
Indeed, the specialist warned that these rules could significantly increase costs. Particularly for small crypto fund managers. Not to mention that, according to Hester Peirce, the commissioner of the SEC, the new rules would restrict the negotiating power of wealthy investors.
Risks, among others, which have sparked strong reactions against the SEC. Friday 1er September, several hedge funds and private equity firms sued the stock market watchdog. They accuse the regulator of exceeding its legal mandate by implementing these rules, considered radical. The crypto industry is used to this.
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