A Texas court has ordered the US Securities and Exchange Commission (SEC) to repeal a rule that broadly redefined the term “dealer” in the crypto industry and traditional finance. The rule was passed by SEC committee members in a 3-2 vote in February, and the court found that it exceeded the SEC’s statutory authority.
Traditionally, a dealer is an entity that buys and sells securities for its own account, rather than trading for others. The SEC’s expanded definition was intended to include any entity that affects market liquidity, particularly in the US Treasury market. Crypto industry players initially raised objections to the rule, as it would require entities “involved in trading crypto securities” to comply with securities laws, register with the SEC, and join industry-backed self-regulatory organizations.
