SEC Commissioner Advocates for Distinct S-1 Registration for Digital Assets

U.S. Securities and Exchange Commission (SEC) commissioner Mark T. Uyeda emphasized the need for a specialized S-1 registration form for digital asset securities during a fireside chat at Korea Blockchain Week 2024 in Seoul, South Korea.

An S-1 form is a registration statement required by the SEC for U.S. issuers before offering new securities products. This includes various disclosures like income statements and cash flow statements.

Uyeda illustrated the inadequacies of the standard registration form for certain financial products using registered index-linked annuities, advocating for tailored registration requirements in the digital asset space.

He expressed frustration at the SEC’s slow progress in accommodating digital asset securities sponsors, highlighting the agency’s flexibility to create distinct forms. “Why shouldn’t we do the same thing with crypto?” he asked.

Uyeda cautioned against creating a “catch-22 situation” where digital asset securities sponsors face irrelevant registration requirements. He noted that such filings come after issuers determine their products as securities under federal regulations.

While tokens and cryptocurrency exchange-traded funds fall under SEC supervision, the classification of cryptocurrencies remains uncertain. Ripple’s Chief Legal Officer, Stuart Alderoty, criticized the term ‘crypto asset security’ as having no legal basis, urging the SEC to provide clarity in its categorization.

Uyeda disagreed with the SEC’s rejection of Coinbase’s rulemaking petition, advocating for clearer definitions of what constitutes securities within digital assets. He expressed hope for future regulatory progress, possibly under different leadership.

Notably, Gensler’s regulatory agenda does not include digital assets among the over 50 items he has prioritized. Uyeda stressed the importance of considering global jurisdictions, including the EU, South Korea, and Japan, for future rulemaking.

As one of five SEC commissioners, Uyeda’s term continues until June 2028, and he noted that his views are personal and do not speak for the entire agency.