Key highlights:
- The SEC has concluded its investigation into the Zcash Foundation and will not take enforcement action.
- Zcash remains a leading cryptocurrency for transaction privacy with zero-knowledge proof technology.
- Upcoming U.S. legislation could redefine how digital assets and privacy-focused cryptocurrencies are regulated.
The U.S. Securities and Exchange Commission (SEC) recently concluded its investigation into the Zcash Foundation, which had started in August 2023. The regulator confirmed it would not pursue enforcement actions against the organization responsible for developing the privacy-focused cryptocurrency Zcash.
The Zcash Foundation shared that the SEC had completed its review of certain cryptocurrency asset offerings. The organization noted that the outcome reflects its dedication to transparency and compliance with regulatory requirements. It also highlighted its ongoing efforts to build financial infrastructure that prioritizes transaction privacy.
SEC takes softer approach to crypto oversight
Over the past year, the SEC has dropped several major investigations and lawsuits involving high-profile crypto companies. Observers suggest this may indicate a more flexible regulatory approach toward the crypto industry under the current administration.
Nearly 60% of SEC’s crypto cases have disappeared after Trump took office. Source: Protos
Earlier this week, a four-year SEC investigation into the DeFi protocol Aave concluded. The project’s CEO, Stani Kulechov, stated that the SEC would not take action against the platform.
Zcash specializes in transaction privacy through zero-knowledge proof technology, allowing users to choose between transparent and private transactions. This dual approach may continue to be a point of focus in future regulatory discussions.
New legislation could reshape crypto regulation
The U.S. Senate Banking Committee is scheduled to debate the CLARITY Act, also known as the Responsible Financial Innovation Act, on January 15. The legislation aims to clearly define how the SEC and Commodity Futures Trading Commission (CFTC) will regulate digital assets.
The Senate Agriculture Committee will review its own version of the bill on January 27. Both committees must reach an agreement before the Senate votes on the final legislation. Experts note that this bill could significantly influence the U.S. regulatory framework for cryptocurrencies, including privacy-focused assets like Zcash.
Regulators have historically struggled to classify assets using zero-knowledge proof technology. While Zcash sits in a gray area between payment systems and investment instruments, European regulators are already tightening privacy token rules under MiCA regulations.
Beyond the regulatory outcome, Zcash has recently attracted market interest, as technical indicators suggest a potential rally may be forming.
The evolving political and regulatory environment may lead to future debates over privacy-focused cryptocurrencies worldwide.
Source: https://coincodex.com/article/80171/sec-ends-zcash-investigation-without-action/
