Are Cryptocurrencies Securities? What Regulators Outside the USA Say, and the SEC's Stance.

In recent years, the world of cryptocurrencies has gained popularity and has aroused the interest of investors and supervisory entities worldwide. One of the most important debates is whether cryptocurrencies can be considered securities or not.

In this article, we will examine the perspectives of regulators outside the United States, as well as the stance of the Securities and Exchange Commission (SEC) regarding the classification of cryptocurrencies as securities.

Regulators in Europe

In Europe, the European Securities and Markets Authority (ESMA) has adopted a cautious approach towards cryptocurrencies.

The question of whether cryptocurrencies are securities has been addressed by the MICA Law (Markets in Crypto-Assets Regulation) proposed by the European Union. The MICA Law seeks to establish a comprehensive regulatory framework for cryptocurrencies and digital assets in Europe. The law defines different categories of crypto assets and sets specific requirements for each one.

Under the MICA Law, some crypto-assets can be classified as "significant crypto-assets" and would be granted the status of financial value. This implies that they would be subject to regulations similar to those of traditional securities.

Regulators in Malta and the Malta Financial Services Authority (MFSA):

Malta has stood out as a cryptocurrency and blockchain hub in Europe. The Malta Financial Services Authority (MFSA) has adopted a progressive stance towards cryptocurrencies and has developed a regulatory framework that provides clarity to cryptocurrency companies operating in the country. The MFSA has issued specific guidelines for Initial Coin Offerings (ICOs) and has set compliance requirements for crypto-asset-related services companies.

In Malta, cryptocurrencies are not automatically considered securities. The classification will depend on the specific features and circumstances of each particular cryptocurrency. However, the MFSA has emphasized the importance of regulatory compliance and investor protection in the cryptocurrency space.

Regulators in Asia

In Asia, the stance of regulators varies from one country to another. In Japan, cryptocurrencies are considered as financial assets and are subject to specific regulations. The country has established a legal framework for cryptocurrencies and has granted licenses to exchanges to operate legally. On the other hand, in China, cryptocurrencies have been subject to stricter bans and restrictions, and the authorities have adopted a more adverse stance towards them.

Regulators in Latin America

In Latin America, the regulation of cryptocurrencies is still in development. Some countries, such as Brazil and Mexico, have recognized cryptocurrencies as legal means of payment but have not yet issued specific regulations on their classification as securities. However, it is important to note that the stance and regulations can vary in each country in the region.

The SEC's Stance

In the United States, the SEC has been closely monitoring and regulating the cryptocurrency market. The SEC has stated that, depending on the particular features and circumstances of a particular cryptocurrency, it can be classified as a security subject to U.S. securities laws. The SEC has focused on determining whether a cryptocurrency fits the definition of an "investment contract," which is a form of security that falls under its jurisdiction. This implies that certain cryptocurrency offerings may require compliance with securities laws, such as registration with the SEC or the issuance of a disclosure statement.

Outside of the United States, regulators' approaches vary from the adoption of specific legal frameworks to more cautious and restrictive stances. The SEC in the United States has made it clear that some cryptocurrencies may be considered securities subject to securities regulations. The classification of cryptocurrencies as securities is influenced by various factors, such as the purpose and functionality of each particular cryptocurrency, as well as the specific policies and laws of each jurisdiction.

It is essential that investors and market actors are aware of local regulations and seek professional advice to make informed decisions.