Prof. Yuliya Guseva
Machiavelli famously said that actions of all men, particularly of regulators, should be judged by the results. Paraphrasing Machiavelli, the end justifies the means. This lecture will address a situation where the means undermine the regulatory ends.
The focus of this lecture is the United States Securities and Exchange Commission (“SEC”), the major capital-market watchdog. Created in the wake of the Great Depression, the SEC pursues a ternary set of objectives, including protecting investors, maintaining efficient markets, and facilitating capital formation. This lecture will examine a fundamental disconnect between the objectives of the SEC and the actual outcome of its policies in digital-asset markets – the agency’s enforcement efforts under the mantra of protecting investors and providing cryptoasset markets with more information have produced an environment with less information.
The lecture will discuss securities regulation in the United States, offerings of cryptoassets, and various exemptions such as private placements. Using two hand-collected datasets, the lecturer will show that following an increase in enforcement cryptoasset issuers have attempted to comply with securities law by resorting to private placements. This compliance option reduces market transparency and is harmful to the less sophisticated crypto-investors. In contrast, the more sophisticated crypto-investors do not rely on SEC-enforced regulations.
To conclude, in actively enforcing pre-digital-asset law, the SEC has funneled crypto-issuers into inadequate and lackadaisical compliance with exemptions and created a status quo that is antithetical to the SEC’s core mission of protecting investors. This status quo is also harmful to crypto-issuers, who face higher capital costs. As no one wins in this scenario, a reform revising crypto-issuer disclosure is needed. The lecture will conclude by reviewing regulatory and legislative proposals.
Tuesday, 9th Nov. 2021
Online via Zoom
Zoom link will be visible to registered people
Prof. Yuliya Guseva
Yuliya Guseva is a professor at Rutgers Law School. Guseva’s research and teaching interests are capital markets, securities law, law and economics, financial regulation, regulation of cryptoassets, fintech, and cross-border transplantation of business law. Professor Guseva is the Head of the Fintech and Blockchain Program of the Rutgers Center for Corporate Law and Governance. Professor Guseva’s recent scholarship includes articles and essays published or accepted for publication in the Boston College Law Review (reprinted in the Securities Law Review), the Journal of Corporation Law, the Stanford Journal of Blockchain Law & Policy, the Columbia Business Law Review, the Maryland Law Review, the Cardozo Law Review, the University of Pennsylvania Journal of International Law, the Georgetown Journal of International Law, and Cambridge University Press. Her work has been selected for presentation at annual meetings of the American Law and Economics Association, the European Association of Law and Economics, and other prestigious venues. Guseva was a visiting scholar at Cornell Law School and a visiting professor at Central European University in Vienna, Austria. Prior to joining Rutgers, Professor Guseva was a visiting assistant professor at Fordham Law School, where she taught Commercial Law and International Business Transactions, a postdoctoral research fellow at the Program in the Law and Economics of Capital Markets at Columbia Law School, and Kauffman Legal Research Fellow at Columbia Law School.
|Welcome & Introduction
|Prof. Yuliya Guseva
|Regulation of Digital Assets: Rulemaking, Crypto-Enforcement, and Market Impact