Coinbase app on the Appstore. Photo: Diego M. Radzinschi/ALM Is the SEC's Regulation of Crypto Lenders Self-Defeating?
U.S. holders of cryptocurrency have been eager to participate in the crypto lending market, but recent actions by the SEC are causing unexpected, and likely unintended, changes in how these loans are made. In fact, the SEC's actions may well reduce the amount of lending done through products registered with the SEC and increase the amount of lending on platforms that are not operated by licensed U.S. companies.
March 30, 2022 at 12:15 PM
8 minute read
Cryptocurrency lending has been increasing at a blistering pace over the last several years. By some measures, the volume of cryptocurrency lending has surpassed the volume of lending on traditional peer-to-peer lending platforms, which are limited to fiat currency loans. U.S. holders of cryptocurrency have been eager to participate in this lending market, but recent actions by the U.S. Securities and Exchange Commission are causing unexpected, and likely unintended, changes in how these loans are made. In fact, the SEC's actions may well reduce the amount of lending done through products registered with the SEC and increase the amount of lending on platforms that are not operated by licensed U.S. companies.
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