The U.S. Securities and Exchange Commission (SEC) announced that it would streamline the application process for investment companies, which could result in blockchain and crypto-currency companies operating „more efficiently and less expensively“.
In a July 6 announcement on the SEC Web site, the commission said it voted to adopt amendments to the rules for an expedited review process for companies under the Investment Company Act. In addition, the SEC referred to a „new informal internal procedure“ for any other application that did not qualify for this expedited process.
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The announcement stated that the changes had been made for a „more efficient“ application process and to provide „greater certainty and transparency“. The SEC said granting such exemptions could provide „significant economic benefits to the funds and their shareholders.
„The application process under the Investment Company Act is an important component of our regulatory structure,“ SEC Chairman Jay Clayton said. „The changes approved today will modernize and streamline this process, resulting in greater transparency, cost reduction and more efficient use of our staff resources.
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As part of the rules of the Investment Companies Act of 1940, any company applying for an SEC listing faces a number of challenges in operating legally. The SEC said these changes would be effective 270 days after publication in the Federal Register.
Faster for crypto-currency funds?
The Commission has been hesitant to approve Bitcoin’s exchange-traded funds (ETFs), including the New York-based WisdomTree. Arca Labs, which runs its ArCoin on the Ethereum blockchain, speculated that no platform will be available to trade its fund through any of the major SEC-registered exchanges.
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Under the new amendments, funds, including ETFs that have required an SEC exemption in order to operate, could qualify for an expedited review. The fund would have to submit a third application that is „substantially identical“ to others granted within three years.
The SEC stated that, in this case, the Commission would notify the applicant within 45 days of the date of submission, provided that the company responded within 30 days.
The review process of a typical IPO application with the SEC reportedly comprises three rounds of inquiries and lasts between one and two months. In January, Grayscale Bitcoin Trust became the first digital asset vehicle to report on SEC rules following its application in November.