a16z Calls for Amendments to Crypto Legislation, Opposes Use of "Ancillary Asset" Definition as Regulatory Basis

According to ChainCatcher, citing a report from Cointelegraph, venture capital firm Andreessen Horowitz (a16z) has called on U.S. lawmakers to amend a draft cryptocurrency regulatory bill, warning that the framework may contain serious loopholes that could undermine investor protection mechanisms.

In an open letter to the U.S. Senate Banking Committee, a16z recommended that regulators address the gaps in the crypto legislation draft. This letter is a formal response to the discussion draft released at the end of July. The discussion draft is based on the 21st Century Financial Innovation and Technology Act (CLARITY Act) and aims to solicit industry feedback to advance regulatory legislation for crypto assets.

a16z specifically pointed out issues with the definition of “ancillary assets” in the draft, a term referring to tokens sold through investment contracts that do not grant buyers equity, dividends, or governance rights. The letter stated: “The structure of ‘ancillary assets’ should not serve as the legislative foundation without significant modifications.”