- Wintermute is a leading trading company and market maker in the cryptocurrency industry.
- The firm supports crypto projects by improving liquidity, aiding listings on exchanges, and offering services like OTC trading and token bridging.
The firm supports crypto projects by improving liquidity, aiding listings on exchanges, and offering services like OTC trading and token bridging.
Wintermute is calling on the United States Securities and Exchange Commission (SEC) for clear regulatory guidance to exclude network tokens from being classified as securities.
In a formal submission, the firm argues that such clarity is essential to prevent the misapplication of securities laws.
They point out that it will help to maintain the competitiveness of U.S. crypto markets.
Wintermute’s feedback was provided in response to the SEC’s request for public comment on the regulatory status of digital assets.
Why does Wintermute ask to exclude networked tokens?
The company emphasized that network tokens are intrinsically tied to the operation of decentralized blockchain networks or protocols.
Wintermute believes that tokens are fundamentally distinct from traditional financial securities.
The firm argued that these tokens serve as technical components of blockchain ecosystems rather than financial instruments.
Wintermute likened network tokens to commodities, collectibles, or real estate.
They asserted that their potential use in trading or fundraising does not warrant their classification as securities.
The firm warned that labeling network tokens as securities could impose stringent regulatory requirements on every trade.
In their submission, Wintermute identifies this classification as something that impacts token liquidity.
Further, they say it increases costs for traders and potentially drives blockchain development and trading activities offshore.
“Such misclassification risks stifling innovation and pushing blockchain development outside of U.S. markets,” Wintermute said.
The company stressed that clear SEC guidance would ensure the continued growth of the crypto industry while fostering healthy dialogue between regulators and market participants.
Wintermute’s recommendations come at a critical time for the cryptocurrency industry. Right now, regulators are struggling to balance consumer protection and technological advancement.
The firm’s call for clear guidelines shows heightening concerns about the potential overreach of securities laws in the rapidly evolving digital asset space.
