Andreessen Horowitz warns of loopholes in draft US crypto rules

Andreessen Horowitz urged the US Senate Banking Committee to scrap the “ancillary asset” concept in draft crypto legislation, warning of loopholes.

Venture capital firm Andreessen Horowitz (a16z) called on US lawmakers to revise a draft crypto regulation bill, warning that the proposed framework could open dangerous loopholes and undermine investor protections.

In a Thursday open letter to the US Senate Banking Committee, the investment firm urged regulators to close loopholes in the draft crypto legislation. The letter was a response to the discussion draft released in late July.

The discussion draft in question builds on the 21st Century Financial Innovation and Technology Act (CLARITY Act) and seeks industry input on the ongoing crypto regulation. A16z points to the definition of ancillary assets, referring to tokens sold with an investment contract that give buyers no equity, dividend or governance rights.

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