Another video. Does it work?

A who is currently Chief legal Officer at ZERO X Labs which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary Gez is, is certainly addressing you guys. Uh Zrx is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Ginzler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for tokenization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities, um which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation, um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction there are, he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CF DC has jurisdiction. Um And he said that, you know, the SE C's goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but you recognize that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology makes it unnecessary cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion. Uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So Zero X is AD I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will. That's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that, and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter, um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. I, yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there? Um who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be, uh, him or her, you know, good buck. But I, I think that's a perfect scenario. The closer um ecosystems, crypto ecosystems get to the way that Bitcoin functions, I think, uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with the SEC? And, um, if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um But, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um how do you reach compliance? How do you do what you want to do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because because uh during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space, uh just for, for many different reasons. Um not least, uh the one that, that chair Cansler recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Ginzler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify. Zero X is not an exchange. Uh zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation, um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction, there are what he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the SE C's goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um, you know, because currently the SEC has not, uh, really shown an appetite for just having a discussion, uh, that does not hold the potential for, um, enforcement activity. Uh, should the wrong thing be said? Um, you know, and so I think projects are very cautious, right? I I just also want to clarify. So Zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized but, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with, you see, are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter. Um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized, we can usually find someone who we think should bear a compliance responsibility here and that's the person. Um We're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there? Um who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be uh him or her, you know, good buck. But I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way that Bitcoin functions, I think uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And um if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way? Um, there should be an avenue, uh, to do that. It's interesting because because uh during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Ginzler position the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um not least, uh the one that, that chair Canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former sec senior counsel Ashley, a who is currently Chief Legal Officer at Zero X Labs which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So Zero is AD I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble they are securities, the service providers if you wish the, the crypto exchanges the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. And so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um you know, there was really nothing new in, in what Chair Gensler said. Um I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um You know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are he called nonsecurity um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent so it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um you know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter. Um, you know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person, um, we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration, um, responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem who's the central actor there, um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be uh him or her, you know, good buck. But I, I think that's a perfect scenario. The closer um ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to commissioner per, um, safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um how do you reach compliance? How do you do what you wanna do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um um not least uh the one that the chancellor recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed joining us now to discuss is former sec senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the zero X ecosystem. Welcome to the show, Ashley. So zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh, we actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers, if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um, he's saying that he believes the majority of our all, um, tokens are, are securities, um, which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um, that all depends on how they're marketed. I'm not sure exactly what the question was. Um, in the initial clip you showed, um, that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction, there are he called nonsecurity um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the Se C's goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner purse has proposed. Um, you know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said. Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So Zero X is AD I Exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I I will. That's a topic for another day. Ok. So, but a lot of platforms call themselves decentralized but, but actually believes they're quite concentrated or there are quite a few of them that are at least, and that, and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter, um, you know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person um We're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be uh him or her, you know, good buck. But I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh during speeches made by today, he said, basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um not least uh the one that, that chair Kel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SCC senior counsel Ashley Arber, who is currently Chief legal Officer at ZERO X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero X is Ad I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh Zrx is the native token um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble they are securities, the service providers if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. And so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify. Zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um you know, there was really nothing new in, in what chair Gensler said. Um, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um, he's saying that he believes the majority of our all, um, tokens are, are securities, um, which, you know, is, is necessary for the SEC to have any jurisdiction over them at all. I mean, full stop. Um that all depends on how they're marketed. I'm not sure exactly what the question was. Um, in the initial clip you showed, um that was being responded to, but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF, that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction there are he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion uh that does not hold the potential for um enforcement activity uh should the wrong thing be said. Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So zero X is AD I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called, called ZERO X. So II, I guess I, I will. That's a topic for another day. Ok. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least. And that, and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter, um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized, we can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem who's the central actor there. Um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be, uh, him or her, you know, good buck. But I, I think that's a perfect scenario, the closer, um, ecosystems, crypto ecosystems get to the way that Bitcoin functions, I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to commissioner per, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um how do you reach compliance? How do you do what you wanna do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um not least, uh the one that, that Chair canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless. And uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So Zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh, ZRX is the native token. Um Chairman Gz are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair GS said. Um I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80. Um like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities, um which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed, um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that, as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and So I think projects are very cautious, right? I I just also want to clarify. So Zero X is AD I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I I will. That's a topic for another day. Ok. So, but a lot of platforms call themselves decentralized But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least, and that, and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter, um, you know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here. And that's the person, um, we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration, um, responsibility under whatever the relevant uh, securities law is. Um, I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh, yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there? Um who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be uh him or her, you know, good. But, but I, I think that's a perfect scenario, the closer um, ecosystems, crypto ecosystems get to the way that Bitcoin functions, I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws, but I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's um Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of security laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again? I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way? Um, there should be an avenue uh, to do that. It's interesting because, because, uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing, uh, uh disconnect here where, you know, yes, that's Ginzler position, the industry. I don't think the industry feels diametrically differently. Um, you know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset Space, uh just for for many different reasons. Um not least, uh the one that, that chair Cansler recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SCC senior counsel Ashley, a who is currently Chief legal Officer at Zero X Labs which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So XX is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security. And thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. And so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF, that's a different story. Um But I, I think, you know what really jumped out at me was, um, his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are he called nonsecurity um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that commissioner purse has proposed. Um you know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So zero X is AD I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called, called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter. Um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized, we can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be um you know, or has a, has a registration, um, responsibility under whatever the relevant, uh, securities law is. Um, I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh, yes, I mean, Bitcoin is a perfect example. Um, the Bitcoin ecosystem, who's the central actor there? Um, who's the one who should have compliance responsibility? Um, you know, II, I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be uh him or her, you know, good. But, but I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think, uh the reality is they move farther and farther away from the sec, regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws but I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you wanna do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing, uh, uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um, you know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space, uh just for, for many different reasons. Um, not least, uh, the one that, that chair canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley, so Zero X is AD I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh Zero Rx is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making, um uh such statements that would give an investor an expectation, um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are what he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the SE C's goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But, you know, that, as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um, you know, because currently the SEC has not, uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called, called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter. Um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person, um we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um, the Bitcoin ecosystem, who's the central actor there? Um Who's the one who should have compliance responsibility? Um You know, II, I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be, uh, him or her, you know, good luck. But I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way that Bitcoin functions, I think, uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way. Um, there should be an avenue, uh, to do that. It's interesting because, because, uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing, uh, uh, disconnect here where, you know, yes, that's Ginzler position. The industry, I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um not least, uh the one that, that chair Cansler recognized that disclosures the same disclosure regimes may not be completely necessary. Um and it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed joining us now to discuss is former SCC senior counsel Ashley, a who is currently Chief legal officer at Zero X Labs which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZR is the native token um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers, if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. And so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um you know, there was really nothing new in, in what chair Gensler said. Um I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities, um which, you know, is, is necessary for the SEC to have any jurisdiction over them at all. I mean, full stop. Um that all depends on how they're marketed. I'm not sure exactly what the question was. Um In the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation, um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but you recognize that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things, it's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said. Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So Zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I I will, that's a topic for another day. Ok. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter, um, you know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person, um, we're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be uh him or her, you know, good buck. But I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way that Bitcoin functions. I think uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to commissioner per, um, safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary. Again, I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you wanna do in the most compliant way? Um, there should be an avenue uh, to do that. It's interesting because, because, uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um Not least uh the one that, that Chair Canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh Zero Rx is the native token. Um, Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um you know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um, he's saying that he believes the majority of all, um, tokens are, are securities, um, which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um, that all depends on how they're marketed. I'm not sure exactly what the question was. Um In the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction there are he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases, a lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion. Uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I I will. That's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least, and that, and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter, um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be, um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem who's the central actor there, um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Satoshi Nakamoto rather than claiming to be, uh, him or her, you know, good buck. But I, I think that's a perfect scenario, the closer, um, ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really, what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um how do you reach compliance? How do you do what you want to do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh during speeches made by today, he said, basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space, uh just for, for many different reasons. Um not least, uh the one that, that chair Kel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal officer at ZERO X Labs which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So Zero is AD I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble they are securities, the service providers if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um, it, they do not actually do that. So II I just need to clarify that. Um, you know, there was really nothing new in, in what chair Gensler said. Um, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um, he's saying that he believes the majority of our all um, tokens are, are securities, um which, you know, is, is necessary for the SEC to have any jurisdiction over them at all. I mean, full stop. Um that all depends on how they're marketed. I'm not sure exactly what the question was. Um, in the initial clip you showed, um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making, um uh such statements that would give an investor an expectation. Um, you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction there are, he called nonsecurity um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But, you know, that, as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion uh that does not hold the potential for um enforcement activity uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I I just also want to clarify. So zero X is ad I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called ZERO X. So II, I guess I, I will. That's a topic for another day. OK. So, but a lot of platforms call themselves decentralized but, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that, and have an obligation to register with SCC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter, um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized, we can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not, I, yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um Who's the one who should have compliance responsibility um, you know, II, I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be, uh, him or her, you know, good buck. But I, I think that's a perfect scenario, the closer, um, ecosystems, crypto ecosystems get to the way the Bitcoin functions. I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. So, what's the likelihood they would actually register with the SEC? And, um, if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to commissioner per, um Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws. We're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena. Um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you wanna do in the most compliant way? Um, there should be an avenue, uh, to do that. It's interesting because, because, uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing, uh, uh, disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um, you know, I think their point is just that you cannot apply the existing securities laws in the exact same way, um, to the crypto asset space, uh, just for, for many different reasons. Um, not least uh the one that, that Chair Canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SEC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero is AD I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gentzler is very careful with his choice of words. So So I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify zero X is not an exchange. Um Zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities, um which, you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as you know, um because there's not a promoter or any other, an issue or anything that would be making um uh such statements that would give an investor an expectation, um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know, what really jumped out at me was, um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction, there are what he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um You know, because currently the SEC has not uh really shown an appetite for just having a discussion uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So Zero X is AD I exchange but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will. That's a topic for another day. OK. So, but a lot of platforms call themselves decentralized. But, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter, um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person um we're gonna say, or entity we're gonna say should be um you know, or has a, has a registration um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claiming to be, uh, him or her, you know, good luck. But I, I think that's a perfect scenario. The closer, um, ecosystems, crypto ecosystems get to the way that Bitcoin functions. I think, uh, the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um, platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um Yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws, but I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um But, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the sec or the next communication is gonna be, be a subpoena. Um is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um how do you reach compliance? How do you do what you want to do in the most compliant way? Um There should be an avenue uh to do that. It's interesting because, because uh during speeches made by today, he said, basically that crypto doesn't need more guidance. Do you agree with that? Um I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space, uh just for, for many different reasons. Um Not least, uh the one that, that chair Cansler recognized that disclosures the same disclosure regimes may not be completely necessary. Um and it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former sec senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley, so Zero X is AD I exchange on the Ethereum Blockchain. So I feel like Gary Gusler is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip I want to have to listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers. If you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized so-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens, but the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. And so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify. Zero X is not an exchange. Uh zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um You know, there was really nothing new in, in what chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um That all depends on how they're marketed. I'm not sure exactly what the question was. Um in the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction there are, he called nonsecurity, um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the SE C's goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And, but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology, he makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that Commissioner Purse has proposed. Um, you know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So Zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized but, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with um a crypto client who signed the engagement letter. Um You know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized, we can usually find someone who we think should bear a compliance responsibility here and that's the person, um we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration, um responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one is decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be uh him or her, you know, good buck. But I, I think that's a perfect scenario, the closer um ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really and their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And um if they don't, will the SEC begin enforcement actions. Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws. But I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, safe harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity. But, you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way? Um, there should be an avenue, uh, to do that it's interesting because, because, uh, during speeches made by today, he said, basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing, uh, uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um, you know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um Not least, uh the one that, that chair Kel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed. Joining us now to discuss is former SCC senior counsel Ashley Arber, who is currently Chief legal Officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So Zero is AD I Exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token um Chairman GZ are also saying that most cryptocurrencies are securities. Uh We actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble they are securities, the service providers if you wish the the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing those services around some very small handful of nonsecurity tokens, crypto nonsecurity tokens. But the vast number of these thousands of tokens uh uh uh without prejudging any one of them meet the standard of being a security and thus the platforms have a obligation to come in register. So actually, of course, Chairman Gusler is very careful with his choice of words. So, so I wonder what jumped out at you and its significance. Sure. Well, first I need to clarify. Zero X is not an exchange. Uh zero X is a software provider that is helping developers uh with the infrastructure um for organization of assets and for value to flow freely. Um It, they do not actually do that. So II I just need to clarify that. Um you know, there was really nothing new in, in what Chair Gensler said. Um I, I think that's probably what you would expect. I mean, this echoes what he's been saying for a while. I don't, wouldn't expect him to do a 1 80 like Jay Clayton before him. Um He's saying that he believes the majority of our all um tokens are, are securities um which you know, is, is necessary for the sec to have any jurisdiction over them at all. I mean, full stop. Um that all depends on how they're marketed. I'm not sure exactly what the question was. Um In the initial clip you showed um that was being responded to but Bitcoin, you know, is pretty widely viewed as, as a nonsecurity as, as, you know, um because there's not a promoter or any other an issue or anything that would be making um uh such statements that would give an investor an expectation. Um you know, of, of that they would profit from the actions of another person. So if he was talking about packaging things into something like an ETF that's a different story. Um But I, I think, you know what really jumped out at me was um his recognition that, you know, obviously there are securities over which the SEC has jurisdiction. There are he called nonsecurity um crypto tokens or which, you know, the SEC just doesn't have jurisdiction, the CFTC has jurisdiction. Um And he said that, you know, the S ECs goal here is to ensure that there's complete disclosure um to allow uh purchasers of, of these crypto assets to make informed decisions um on, on their investments. Um And but he recognized that disclosure in the crypto asset context may not look the same, you know, you're not gonna get, you know, AAA 10-K or in 10-Q every, every period from, from an issue or one of these things. It's the technology makes it unnecessary in many cases. A lot of this is very transparent. So it's sort of case by case, but he recognized it, there may be a difference here and he's open to that and to his staff um uh exploring that. Um But you know, that as you said, would require people, you know, projects to go in and engage with the SEC, which I think that they're loathe to do in the absence of something like the safe harbor that commissioner purse has proposed. Um, you know, because currently the SEC has not uh really shown an appetite for just having a discussion, uh that does not hold the potential for um enforcement activity. Uh should the wrong thing be said? Um You know, and so I think projects are very cautious, right? I, I just also want to clarify. So zero X is AD I exchange, but Zero X Labs is a company that provides and builds software infrastructure. Um So a lot of, yeah, is there's not, there's not an exchange called called Zero X. So II, I guess I, I will, that's a topic for another day. OK. So, but a lot of platforms call themselves decentralized but, but Geza actually believes they are quite concentrated or there are quite a few of them that are at least and that and have an obligation to register with SEC are a lot of D five platforms actually centralized. I mean, I think Ginzler, you know, he made the point of, you know, if you're a lawyer and you've worked with, um, a crypto client who signed the engagement letter. Um, you know, I think the Se C's point in that it's made repeatedly is these things that say they're decentralized. We can usually find someone who we think should bear a compliance responsibility here and that's the person, um, we're gonna say, or entity we're gonna say should be, um, you know, or has a, has a registration, um, responsibility under whatever the relevant uh securities law is. Um I think, you know, are many, I, I'm, I'm not one to sort of go down the line and say this one's decentralized. This one is not. Uh Yes, I mean, Bitcoin is a perfect example. Um the Bitcoin ecosystem, who's the central actor there, um Who's the one who should have compliance responsibility? Um You know, II I, when Satoshi Nakamoto um became a pseudonym and entered the scene and, you know, I, I think that that sort of settled that issue. I mean, if you can find someone who is actually Nakamoto rather than claim to be uh him or her, you know, good buck. But I, I think that's a perfect scenario. The closer um ecosystems, crypto ecosystems get to the way the Bitcoin functions, I think uh the reality is they move farther and farther away from the sec regulated space. Well, what's the likelihood of, and just to address the, the first clip was addressing, you know, um platforms that were accepting Bitcoin or other cryptocurrencies or, or anything of value really? And their need thereby to register with SEC and deal with the securities laws. What's the likelihood they would actually register with SEC? And, um, if they don't, will the SEC begin enforcement actions? Um, yeah, I mean, I, again, I'm not sure the exact question. I mean, someone's mere acceptance of Bitcoin wouldn't necessarily be salient under the securities laws, but I think, you know, really what it's gonna take for platforms to be comfortable going in and having a frank discussion with the SEC is going to be, um, you know, something analogous to Commissioner P's, um, Safe Harbor proposal of, you know, if you're just starting out, we're gonna give you not a pass. But, but for, um, the, uh, the, any fraud provisions of securities laws, we're gonna say you have some time to develop your tech before we're going to require, uh, that you, you know, meet certain requirements. Um, I don't know that that's exactly what we'll end up with. Um, but, you know, something that would let projects come in and have a frank conversation without being worried that, you know, the next letter they get from the SEC or the next communication is gonna be, be a subpoena, um, is something that would probably be necessary again. I mean, certainly if there's fraud occurring, um, I, I think no one believes that quarter should be given to, to fraudulent activity, but you know, if you're just trying to have a discussion about how do you, um, how do you reach compliance? How do you do what you want to do in the most compliant way? Um There should be an avenue uh, to do that. It's interesting because, because uh, during speeches made by today, he said basically that crypto doesn't need more guidance. Do you agree with that? Um, I mean, this is sort of the, the ongoing uh uh disconnect here where, you know, yes, that's Kinsler's position, the industry. I don't think the industry feels diametrically differently. Um You know, I think their point is just that you cannot apply the existing securities laws in the exact same way um to the crypto asset space uh just for, for many different reasons. Um not least uh the one that, that Chair Canel recognized that disclosures the same disclosure regimes may not be completely necessary. Um And it, it may look different regardless and uh that sort of fine tuning um is, is, is what may be needed joining us now to discuss is former SCC senior counsel Ashley Arber, who is currently chief legal officer at Zero X Labs, which focuses on building exchange infrastructure in the Zero X ecosystem. Welcome to the show, Ashley. So zero is AD I exchange on the Ethereum Blockchain. So I feel like Gary G is, is certainly addressing you guys. Uh ZRX is the native token. Um Chairman GZ are also saying that most cryptocurrencies are securities. Uh, we actually have another clip. I want to have a listen to a lot of cryptocurrencies do resemble securities. What's the next step? They don't just resemble, they are securities, the service providers if you wish the, the crypto exchanges, the crypto lending platforms, whether they call them c centralized or decentralized. So-called D I, they're transacting and providing services to the public and they're providing.