This Week in ESG and Impact Investing

A new draft Senate Banking Committee bill could significantly reshape how digital assets are regulated, potentially exempting most secondary market transactions from securities laws while enabling innovation, and combating illicit financial activity. Legislative Framework Rather than invent a new asset class, as the CLARITY Act does, the Senate Banking Committee has opted to amend the Securities Act of 1933 to include digital commodities under definition of ancillary assets and define ancillary asset originators as the initial distributors of ancillary assets. An ancillary asset is often sold within an investment contract; however, the asset itself is not a security. Therefore, non-security based transactions, meaning most secondary transactions, are exempt from securities laws. The SEC is mandated to create a process, similar to the CLARITY Act’s maturity certification, for ancillary asset originators to apply for disclosure requirement exemptions. To standardize the application of s...

In a surprising turn of events, the House of Representatives’ “Crypto Week” got off to a rocky start on Tuesday with the failure of a procedural vote hoping to bundle the GENIUS Act, the CLARITY Act, the Anti-CBDC Surveillance State Act, and the Department of Defense Appropriations Bill into one vote. The vote failed 196-223 with many Republicans voting out-of-party-line. Now each bill will be voted upon individually. The Democratic-led effort to kill the bill cited their main grievances weak as oversight, regulatory arbitrage opportunities, and a lack of consumer protections within the GENIUS and CLARITY Acts, along with a pervasive spirit of corrupt involvements in the crypto industry by the Trump family. There appeared to be little faith in the upside of blockchain and cryptocurrency. Republican supporters of the effort demanded an end to America’s straggling in the crypto regulation race. Other countries like South Korea and EU member nations have already set-up licensing regimes a...