Patrick Daugherty Addresses Avenues for Crypto Case Resolution Under New Administration
Foley & Lardner LLP partner Patrick Daugherty addressed how cryptocurrency cases may be resolved under the new administration in the Bloomberg Law article, “Novel Crypto Rulings to Fill Case Flow Void Left by Trump’s SEC.”
Daugherty said judges will deal with the cases brought to them, regardless of which body of law they are brought under.
“We’ll have cases brought by the SEC for fraud and manipulation of crypto assets that are securities; we’ll have the [Commodity Futures Trading Commission] suing for fraud and manipulation of crypto assets that are commodities; and we’ll have the plaintiffs’ bar suing for fraud wherever they see it,” he explained.
“The SEC has limited power to change the meaning of the Howey test, which is at the center of all this,” Daugherty continued, referencing the four-part test outlined by the U.S. Supreme Court to determine if an asset is a security and noting that changing the test’s application to digital assets would require Supreme Court or congressional action.
He added that Congress has already been working on iterations of a market structure bill, which would change oversight of digital assets and assign jurisdiction over specific types to the CFTC or SEC.
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