Richard Heart, the controversial CEO of the cryptocurrency HEX, took to X (Twitter) today to offer his unsolicited opinions on stablecoins and the SEC. In a series of tweets, Heart pontificated on whether stablecoins should be considered “trading stamps” and exempted from SEC regulations.
While Heart raises interesting hypotheticals, his injection into the stablecoin debate comes across as self-serving. As the leader of his own cryptocurrency, Heart has a vested interest in less stringent regulatory oversight. By suggesting stablecoins deserve special exemptions, he invites skepticism about his motives.
In his first tweet, Heart questioned whether stablecoins could be classified as “trading stamps” which have already “been exempted from lots of SEC and Banking regulatory stuff.” He hinted that stablecoins are analogous to the trading stamps of “70 years ago” which have largely been “Forgotten ancient tech.”
What if stable coins are just "trading stamps." And what if many laws, precedents and no action letters already exempted them from lots of SEC and Banking regulatory stuff? What if we're all so young, we just didn't know it was already a thing 70 years ago. Forgotten ancient tech pic.twitter.com/WktbNsH8bM
— Richard Heart (@RichardHeartWin) November 30, 2023
Heart followed up this speculative tweet with an excerpt from older SEC regulations which suggest trading stamps redeemable for cash or merchandise would not meet the SEC’s definition of a “security.” Heart highlighted this decades-old SEC language and claimed “It’s pretty hard to get the SEC to admit what is outside their control.”
While Heart raises thought-provoking historical parallels, his unprovoked straying into legal interpretations around stablecoins seems thinly veiled. As cryptocurrencies brace for looming SEC regulations, Heart conveniently uses stablecoins to advocate for less oversight.
Considering HEX markets itself as a certificate of deposit-like product, perhaps Heart fears his cryptocurrency may fall victim to intensifying stablecoin scrutiny. By cherry-picking favorable SEC language from the past, Heart lays the groundwork to shield his own venture from regulation.
Rather than genuinely searching for clarity around stablecoins, Heart appears to be pursuing deregulation by proxy. As the CEO of his own cryptocurrency creation, Heart has an unavoidable conflict of interest when intruding into stablecoin policy debates. His superficial appeal to trading stamp precedents fails to outweigh concerns over his underlying motivations.
We recommend eToro
Wide range of assets: cryptocurrencies alongside other investment products such as stocks and ETFs.
Copy trading: allows users to copy the trades of leading traders, for free.
User-friendly: eToro’s web-based platform and mobile app are user-friendly and easy to navigate.
