--- title: SEC Waits on Crypto ETF Guidance description: Marrying digital assets to the 40 Act is no simple task, regulator says. image: https://articles.marketsmedia.com/hubfs/Imported_Blog_Media/iStock-880534636-May-12-2022-09-07-40-44-AM.jpg --- ![websites-group](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/new-MMG-01.svg) [![](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/dropdown-new-marketsmedia-logo.svg)](https://www.marketsmedia.com/) [![](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/dropdown-menu-traders-redlogo.svg)](https://www.tradersmagazine.com/) [![](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/dropdown-menu-bestexe-logo.svg)](https://www.bestexecution.net/) [![](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/dropdown-menu-fidesk-logo.svg)](https://www.fixglobal.com/) [![](https://articles.marketsmedia.com/hubfs/raw_assets/public/MarketsMedia_August2021/images/dropdown-fixglobal-new-logo.svg)](https://www.fixglobal.com/) - [*Facebook*](https://www.facebook.com/MarketsMedia/) - [*Twitter*](https://twitter.com/marketsmedia) - [*Linkedin*](https://www.linkedin.com/company/markets-media-llc) - [Newsletter](https://articles.marketsmedia.com/sec-waits-on-crypto-etf-guidance#popup-newsletter) #### Want the latest news on securities markets -- FREE? 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It is important to know the difference.” Rep. Warren Davidson (OH-R) voiced his concern to Blass during her testimony that many on Wall Street and in the digital asset markets are concerned about the SEC’s transparency when it comes to guidance in creating crypto-based products. “We are getting regulation by enforcement, or by rejection in this case,” he said. “But it is hard to discern what actually would meet the criteria.” Blass testified that the SEC has approved more than 300 individual exemptive orders for ETF sponsors and that the 40 Act permits a vast amount of product innovation. “Look at the innovation in the investment management space since 1940,” she said. “Amazing products have come to market and many have provided opportunities to the retail investor.” Blass also stressed the amount of outreach to the asset management community the Division of Investment Management has done regarding cryptocurrency products. The Division sent a staff letter to the Investment Company Institute and the Securities Industry and Financial Markets Association in mid-January requesting industry comments on issues, such as valuation, liquidity, custody and potential market manipulation of crypto-based exchange-traded funds and products as well as hosting a publicly accessible website for additional comments. “The letter and website highlight issues funds should consider before bring its funds to market,” said Blass. “At this point in time, even though we issued the letter in January, they are just coming back to us with their responses.” During his questioning, Rep. Davidson suggested that Congress just might need to update the 40 Act to address issues like custody for token-based products that have ledger entries available not only to the SEC but to anyone. “Going through a duplication of effort to say that we have to tag a security that already has a ledger of who owns the account,” he said. “It would be like saying who really really owns this Fidelity account after Fidelity shows you who the owner is. Why pay a third party to tell you who owns the Fidelity account?” [Share](https://www.facebook.com/share.php?u=https://articles.marketsmedia.com/sec-waits-on-crypto-etf-guidance) [Tweet](https://twitter.com/intent/tweet?text=US+ETFs+Have+Record+Net+Inflows&url=https://articles.marketsmedia.com/sec-waits-on-crypto-etf-guidance) [Share](https://www.linkedin.com/cws/share?url=https://articles.marketsmedia.com/sec-waits-on-crypto-etf-guidance) ![email](https://articles.marketsmedia.com/hubfs/Markets%20Media/email.svg) ### NEWSLETTER SIGN UP And receive exclusive articles on securities markets ### Related articles 1. 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