The US Securities and Trade Fee (SEC) has wrapped up its investigation into Stacks, the layer 2 community constructed on high of Bitcoin, and its developer Hiro Techniques with no enforcement motion, mentioned Muneeb Ali, Stacks’ co-creator. The investigation spanned three years and was targeted on whether or not Stacks tokens in early choices have been securities.

Hiro Techniques, previously referred to as Blockstack, is an organization that develops blockchain know-how. In 2018, it launched the primary model of the Stacks chain, with its eponymous token (STX).

Initially, the corporate handled the STX tokens it offered as securities. A portion of the tokens have been offered on to the general public below a restricted providing below the SEC’s Regulation A+. Different segments of the providing focused accredited buyers or worldwide buyers.

Early in 2021, Hiro transitioned the Stacks community to a brand new model with an up to date consensus mechanism. Hiro believed the Stacks blockchain was now absolutely decentralized because the agency was not offering “essential managerial services” to the community.

Because of the transition, Hiro Techniques claimed the STX tokens have been not wanted to be handled as securities. The SEC, nonetheless, didn’t settle for Hiro’s clarification and launched an investigation into the agency.

The SEC has now dropped the investigation in opposition to Hiro Techniques and Stacks and indicated it won’t pursue enforcement motion.

Ali expressed aid that the investigation into Stacks was over. Nevertheless, he believes the US wants a greater system for regulating the crypto trade.

“We’re pleased that the SEC dropped the investigation after this time and effort. This is the best outcome a company in our industry could ask for, but the US can do better,” Ali acknowledged. “We need a regulatory system that meets builders of innovative open protocols where they are. We’ll continue working with policymakers and developers to help make this happen.”

The choice marks the second authorized win for the crypto trade in opposition to the SEC this week. It follows the latest announcement by the SEC that it closed its investigation into Paxos, with no securities fees filed in opposition to BUSD, a Paxos-issued stablecoin.

Nevertheless, the authorized battle between the SEC and the crypto trade continues. The SEC nonetheless has ongoing lawsuits in opposition to main crypto exchanges like Coinbase, Binance, and Kraken. Moreover, blockchain infrastructure builders equivalent to Consensys and Uniswap Labs stay targets of the regulator.