SEC Declares USDT, USDC, and Other Covered Stablecoins Not Securities

The U.S. Securities and Exchange Commission (SEC) has issued a statement clarifying that certain types of stablecoins, referred to as 'Covered Stablecoins,' such as USDT and USDC, are not considered securities. These stablecoins are designed to maintain a stable value relative to the U.S. dollar on a one-for-one basis and can be redeemed for USD at the same rate. The SEC's Division of Corporation Finance stated that the process of minting and redeeming these stablecoins, which are backed by low-risk and readily liquid assets, does not require registration with the Commission under the Securities Act. The SEC's statement specifically addresses stablecoins like USDT and USDC, which are marketed for use in commerce, as a means of payment, money transmission, and value storage, rather than as investments. This clarification aims to provide regulatory clarity to the stablecoin market, which has been a topic of significant interest and debate in recent weeks. To continue reading this as well as other DeFi and Web3 news, visit us at thedefiant.io