U.S. Securities and Exchange Commission plans to operate cryptocurrency nodes

According to an official document dated July 2nd, the U.S. Securities and Exchange Commission (SEC) plans to hire third-party contractors to run nodes for Bitcoin, Ripple, and Ethereum to monitor compliance risks.

Running Full Bitcoin Nodes for SEC
Despite the availability of many blockchain explorers in the market, the agency's blockchain explorer still hopes to run Bitcoin Core, Ripple, and Ethereum nodes through outsourcing to contractors. In the future, the SEC may also sign contracts with other service providers to run nodes for Bitcoin Cash, Stellar, Zcash, EOS, and NEO.

The document does not explain why the SEC wants to run full nodes for cryptocurrencies, only emphasizing that this move will "help institutions better monitor risks" to improve regulatory amendments.

The agency specifically states that all blockchain data should be obtained from custodial nodes, not from "secondary sources" like blockchain explorers.

Reports indicate that interested contractors can now submit bids and provide complete data solutions, sample data files for institutional review. The data must cover a full node copy from the genesis block to the current blockchain on full nodes.

Diverse Views from the Crypto Community
Unsurprisingly, the crypto community is surprised by the SEC's decision to hire contractors to run nodes. Crypto news reporter Omar Bham tweeted on Twitter:

Welcome to the playground, kids. Let's hope they're not here to bully us.

Analyst Mati Greenspan from Etoro tweeted: "Didn't think I'd live to see the day."

Nic Carter, founder of crypto research firm Coinmetrics, responded to Mati Greenspan's tweet:

You'll never see the day because it's not happening. The SEC will never run nodes; they outsource everything, merely extracting data.

They will never run nodes (not according to this prompt at least), they are outsourcing everything and just ingesting the data. Your parent tweet is not honest.

— nic carnival barker carter (@nic__carter) July 30, 2019

According to the content of the official document, the SEC aims to obtain data such as hash values, mining difficulty and rewards, trade volume and scale, token supply, and block size. It seems more like an outsourcing requirement for monitoring purposes.

In fact, the SEC has not been heavily regulating the cryptocurrency industry this year. Earlier reports from ABM mentioned that the SEC approved a $28 million ICO issuance for Blockstack, allowing them to raise up to $50 million annually. On July 11, they also approved live-streaming platform Younow to launch its $18.7 million Props Token.

Therefore, it remains to be seen whether this move is positive, and further observation of the SEC's next steps is needed.

Further Reading

• How does the US-China trade war affect Bitcoin prices?
• Multiple projects form the Proof of Stake Alliance, aiming to engage with regulatory authorities

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