Victor Fang, CEO of AnChain.AI, says he is granting the SEC the authority to “examine and trace smart contracts.”
According to a representative for AnChain.AI, a blockchain analytics firm, the Securities and Exchange Commission recently awarded the company a $600,000+ contract to assist the government in regulating and monitoring the Defi area. The contract, which began in May 2021, has an initial value of $125 000 but has the potential to increase to $625 000 if the SEC chooses to retain the group for five further $125 000 ‘option’ years.
“The SEC is very keen on understanding what is happening in the world of smart contract-based digital assets,” says Victor Fang, CEO and co founder of AnChain.AI. “So we are providing them with technology to analyze and trace smart contracts”.
AnChain is dedicated to tracing unlawful activities across crypto, decentralized financial institutions, and traditional financial institutions. Along with assisting the SEC in investigating suspected Defi transactions and behavior, they collaborate with centralized cryptocurrency exchanges and fiat institutions to develop “preventive” defenses against predatory operators in the field.
While several SEC (former) members have expressed interest in crypto and decentralized finance, they continue to monitor the field for undesirable actors. Earlier this month, Gary Gensler, the SEC’s current commissioner, outlined to the Wall Street Journal, why Defi and “decentralized” activities continue to face regulatory scrutiny:
“There is still a core group of individuals who are not only responsible for producing the software, such as open-source software, but also for governance and fees…There is some sort of incentive mechanism in place for those promoters and sponsors.”
The Defi industry is currently responsible for the management of over $80 billion in digital assets. As the SEC’s investigations continue, it is possible that many of these assets will be deemed securities.
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