NASAA Pushes Back on Digital Asset Clarity Act
"NASAA anticipates that bad actors will seek to exploit potential ambiguities in the text to challenge state police powers and related authorities, risking years of litigation, conflicting interpretations, and regulatory uncertainty for investors, regulators, and market participants."
Marni Rock Gibson, NASAA President
"NASAA anticipates that bad actors will seek to exploit potential ambiguities in the text to challenge state police powers and related authorities, risking years of litigation, conflicting interpretations, and regulatory uncertainty for investors, regulators, and market participants."
Marni Rock Gibson, NASAA President
State securities regulators urged federal legislators to reject or significantly revise the Digital Asset Market Clarity Act. NASAA demanded Senate Banking Committee members preserve the state-level enforcement framework.
In a letter to Senate Banking Committee leadership, NASAA said it did not oppose digital asset legislation and supports the goal of regulatory clarity, but argued that clarity cannot come at the expense of the state-level enforcement infrastructure that has served as a first line of defense against investment fraud.
NASAA made the following five recommendations to revise the bill:
- Add an explicit savings clause to the regulatory parity section preserving state anti-fraud and enforcement authority
- Extend that enforcement protection consistently throughout the entire bill, not just in isolated sections
- Affirm state licensing and registration authority over broker-dealers and investment advisers
- Align definitions and preemption provisions precisely with the existing federalism framework established by the National Securities Markets Improvement Act of 1996.
- Remove or substantially narrow the SEC's broad exemptive and rulemaking authority. (NASAA said those decisions should be made directly by Congress rather than delegated to a federal regulatory agency.)