Gary Gensler, chairman of the U.S. Securities and Exchange Commission, disagrees with Belgium’s position on the requirements that must be completed for a crypto asset to be classified as a security.
The explanation was provided by Belgium’s Financial Services and Markets Authority (FSMA) in a report dated November 22, 2022, for which a version was made available for public comment in July 2022.
According to the FSMA, the clarification is in response to an increase in inquiries on the applicability of Belgium’s current financial rules and regulations to digital assets.
While not legally obligatory under Belgian or European Union law, the FSMA claimed that cryptocurrencies will be classified as securities under its “step-by-step plan” if issued by a person or company.
The Belgian regulatory agency said that cryptocurrencies that are not classified as securities may be subject to additional rules if a corporation utilizes the digital asset as a means of exchange.
“However, if the instruments have a payment or exchange function, further restrictions may apply to the instruments or the providers of certain services related to the instruments.”
FSMA also highlighted that its stepwise strategy is technology-neutral, implying that it makes no difference whether digital assets exist and are supported on a blockchain or in other ways.
The FSMA prepared the report for the first time in July 2022 to answer commonly asked issues from Belgian digital asset issuers, suppliers, and service providers.
The FSMA noted that the step-by-step approach will act as a guideline until the European Parliament’s Markets in Crypto Assets Regulation (MiCA) takes effect at the beginning of 2024.
In contrast to the “regulation by enforcement” strategy of the U.S. Securities and Exchange Commission (SEC), which is presently competing for digital asset regulatory authority with the U.S. Commodity Futures Trading Commission, Belgium has established explicit standards.
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