White House Embraces Distributed Ledger Tech in National Standards Strategy

The Securities and Exchange Commission (SEC) has excluded the definition of digital assets in the final reporting rules for private equity and hedge funds, while the New York Attorney General has introduced a bill aiming to regulate digital assets and strengthen enforcement powers. Furthermore, the White House has incorporated distributed ledger technology and digital identity infrastructure into its national standards strategy for emerging technologies.

As always, this edition of the BSV Blockchain Gazette is is presented by Bryan Daugherty, Global Policy Director for BSV Blockchain Association.

SEC Drops Definition of Digital Assets in Final Reporting Rules for Private Equity and Hedge Funds

The Securities and Exchange Commission released final reporting rules on May 3 for private equity firms and hedge funds. The proposed rules included a definition of digital assets, but this was dropped from the final rule. In August 2022, the SEC had proposed amendments to its Form PF, which is used by investment advisers to private funds for confidential reporting. It would have required that digital assets be broken out and reported separately from cash or “other” and proposed defining digital assets as assets “issued and/or transferred using distributed ledger or blockchain technology, including, but not limited to, so-called ‘virtual currencies’, ‘coins’, and ‘tokens.’ ” In a footnote to the final rules, the SEC said that “the Commission and staff are continuing to consider this term and are not adopting ‘digital assets’ as part of this rule at this time.”

New York Attorney General Introduces Crypto Regulation Bill, Grants Stronger Authority to Regulate Digital Assets

New York Attorney General Letitia James announced that she has introduced bill, the Crypto Regulation, Protection, Transparency and Oversight Act, or CRPTO, that would grant the New York Department of Financial Services stronger authority to regulate digital assets including enforcement power to issue subpoenas, impose civil penalties for crypto firms violating state law, and shut down companies allegedly involved in fraud or illicit activities.

White House Identifies Distributed Ledger Technology and Digital Identity Infrastructure in National Standards Strategy for Emerging Technologies

On May 4, the White House released U.S. government national standards strategy for critical and emerging technology. In it, eight technology sectors are identified that will have a significant economic impact in the near future. Among the technologies are artificial intelligence, communication and network technologies, and biotechnology and semiconductors, as well as the notable inclusion of distributed ledger technology (DLT) and digital identity infrastructure.