a16z warns that there are loopholes in the crypto assets regulatory draft and suggests adopting a "digital goods" regulatory framework.

On August 1, CoinWorld reported that the well-known venture capital firm a16z urged U.S. lawmakers to amend the encryption regulatory bill draft, warning that the proposed framework could have dangerous loopholes and undermine investor protection. a16z submitted an open letter to the U.S. Senate Banking Committee, proposing amendments to the revised draft of the "21st Century Financial Innovation and Technology Act": 1. Opposes the current "ancillary asset" framework, arguing that it conflicts with the securities law "howey test" and may weaken investor protection; suggests adopting a clearer "digital commodity" regulatory standard. 2. Warns about the regulatory loopholes in the separation of primary/secondary markets, as the project party may exploit exemption clauses to sell assets to insiders at low prices before reselling them to the public market; proposes using "degree of decentralization" as a regulatory boundary, requiring relinquishment of control to lift trading restrictions. 3. Demands that activities related to blockchain foundational technologies, such as running consensus algorithms and executing smart contracts, should not be classified as securities activities.