Jay Clayton Praises Blockchain By Joining Crypto Platform Fireblocks

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Jay Clayton, the former chairman of the U.S. Securities and Exchange Commission, said he believes in both the promise of blockchain technology and the need for more regulation for the crypto industry.

“The US government has an interest in ensuring that as the world begins to digitize, US regulations continue to be as robust, continue to be the gold standard, but also facilitate the adoption of technology, ”he told the Financial Times, when he joined the advisory board of digital asset infrastructure provider Fireblocks.

“I have always liked the potential efficiency of this technology,” he added. “But just because the technology has great promise doesn’t mean you can use it to evade the law. “

New York-based Fireblocks provides a “one-stop-shop” platform for institutions to own, transfer and issue digital assets in different jurisdictions. Its clients include London-based challenger bank Revolut, retail trading platform eToro, and crypto-bank Galaxy Digital.

Last month, Fireblocks raised a Series D funding at a valuation of $ 2 billion with Sequoia Capital, Stripes and Spark Capital leading the round. Its investors include Bank of New York Mellon, the venture capital arm of Silicon Valley Bank and the venture capital arm of Siam Commercial Bank of Thailand, SCB 10X.

Clayton said he was unfamiliar with Fireblocks, which has secured more than $ 1 billion in digital asset transfers, until they approached him about the role. But he said a move to blockchain technology in the financial infrastructure industry was “almost inevitable” and he appreciated the start-up being “committed around the world to doing things the right way. a regulatory point of view “.

“The back office space, the institution-to-institution space, where people are already familiar with digital input and the like, is a good place,” he said.

During his tenure at the SEC between 2017 and 2020, Clayton was known to have curtailed the initial coin offering (ICO) market by designating digital fundraisers as securities. Its staff also refused to approve a Bitcoin exchange-traded fund, frustrating many in the industry at the time.

Clayton told the FT that the securities law framework was already “well structured to deal with securities as digital assets,” but predicted that new regulations might be needed to oversee other emerging digital assets that do not. did not fit into the category of securities, such as digital collectibles or collectible cards.

He also warned that stablecoins, increasingly important assets in the digital economy, could be an entry point for illicit transactions “if not created, maintained and monitored in a regulated environment.” He praised Janet Yellen, Secretary of the Treasury, for having recently brought US regulators together to define a framework to govern them. “Issues like this should not be decided agency by agency,” he said.

Clayton is just the latest U.S. financial watchdog to seize opportunities in the crypto economy.

Christopher Giancarlo, former head of the Commodity Futures Trading Commission, joined the board of bitcoin lender BlockFi earlier this year and also founded a research initiative exploring options for a digital currency from the US central bank.

In March, Clayton joined the advisory board of a crypto asset manager One River Asset Management, which submitted its own bitcoin ETF application. Since leaving the SEC, he has also joined Apollo Global Management as an independent lead director.

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