Yesterday the Chairman of the U.S. Securities and Exchange Commission (SEC) gave an exclusive interview with Bob Pisani of CNBC. There has been widespread news coverage of the interview across both mainstream and alternative news sources.
Most of the reporting about this monumental interview has been focused on the fact that the SEC is claiming the authority to regulate Initial Coin Offerings (ICOs) and tokens that function as a security.
During the interview, Jay Clayton, the SEC Chairman, said something absolutely eye-popping. No, it wasn’t the fact that the SEC intends to regulate ICOs in the same manner that they regulate Initial Public Offerings (IPOs). He said that cryptocurrencies are replacements for the Dollar, the Yen, and the Euro.
Yes, you read it correctly. That’s exactly what he said. Cryptocurrencies are replacements for the Dollar, the Yen, and the Euro.
Maybe his statement was rhetorical? It certainly doesn’t appear to be.
Maybe his statement was a question? It certainly doesn’t appear to be that, either, as he was answering a direct question from Mr. Pisani. Mr. Clayton does not appear to be answering a question with another question. By all appearances, he was stating a fact.
To provide context to his statement, at 1:20 into the interview, Mr. Pisani asks, “Tell us a little more about what you’re planning to do with Bitcoin, cryptocurrencies, and blockchain this year. You brought up ICOs. I talk to my ICO friends, people who are interested in this, and they say ‘We’re stymied. We don’t know what the SEC is planning to do.’ Can you tell us if ICOs are definitely securities, or are you going to carve out some exceptions, and when are you going to make a clear ruling and decision on this?”
Mr. Clayton replies, “OK. So there’s a lot in that area. Let me start with the technology, distributed ledger technology. Incredible promise. It can drive efficiencies not only in the financial markets, but in a lot of markets. Fine. Two areas in the financial markets where distributed ledger technology has come to the fore: Cryptocurrencies. These are replacements for Sovereign currencies. Replace the Dollar, the Yen, the Euro, with Bitcoin. That type of currency is not a security. Let me turn to what’s a security.”
The Chairman went on to explain the SEC’s definition of a security and that the organization he is in charge of regulates both the offering of the security and the trading of it.
In watching the interview, one senses that Mr. Clayton’s words were very deliberate and specifically chosen. He obviously wasn’t speaking by the seat of his pants. He was very well aware of the weight that his words carried. At 2:56 Mr. Pisani asks the Chairman if he was “Planning on making a clear statement on that?”
The Chairman responds, “I thought I just did.”
Mr. Clayton clearly made a statement, and it was equally clear that he said exactly what he intended to say.
He DID say cryptocurrencies “are replacements for Sovereign currencies.”
He DID say “Replace the Dollar, the Yen, the Euro, with Bitcoin.”
Was it rhetorical, or is this another instance of truth hidden in plain sight?
We’ll let you form your own opinion.
We will say, if the latter, Mr. McAfee will win his bet and his manhood will be safe.
You can watch the entire interview here. The segment in which the SEC Chairman states cryptocurrencies will replace the Dollar, Yen and Euro begins at 1:50 and runs to 2:15: