Fed up with the obscurity, crypto companies in the U.S. are coming together to push Capitol Hill into making more explicit crypto regulations. The Cypto Council for Innovation, Chamber of Digital Commerce, The Blockchain Association, and Coinbase Global are part of the group urging Congress to create bipartisan support for a draft bill before the key voting session in a few weeks.
Digital Asset Firms and Groups Come Together for Crypto Regulations
The Securities and Exchange Commission (SEC) regulatory crackdown on the crypto industry spiked 183% after the FTX-saga. Moreover, the financial watchdog of the United States sued the world’s biggest crypto exchange and Coinbase, regarding unregistered securities.
The crypto companies have been trying to expand in Washington for the last two years; they are doing so to combat the surging regulatory scrutiny. The recent regulatory crackdown over the industry showcases how the agency is trying to galvanize the crypto lobby. All these players want a clear regulatory path to walk on.
Cody Carbone, VP of Policy at the Chambers of Digital Commerce, says, “It’s another motivating factor in getting up there and educating Congress.”
The crypto industry though similar to the current financial scenario is drastically different, and it requires a different approach from the authorities to regulate digital assets. Initially, these companies started working in the gray area, and the lack of a proper regulatory framework led to naive consumers being duped.
The SEC swung into action after multiple cases and, intending to provide consumer protection, started taking action against the industry. They are trying to rebrand cryptocurrencies as securities, as evidenced by their recent activities. Experts argue that if they succeed, every issuer must register with the SEC, and the agency will have the crypto industry under their jurisdiction.
Another U.S. agency, the Commodities Futures Trading Commission (CFTC), assert that Bitcoin, Ethereum, and other are commodities and should fall under their jurisdiction. There is an ongoing tussle between the two agencies to rule over the industry. In July 2023, ex-Chairs of CFTC and SEC Timothy Massad and Jay Clayton expressed their views on crypto regulations.
They suggested that instead of fighting over who would govern the digital asset industry, the agencies should join forces and develop a joint regulatory framework, benefiting the industry and investors alike.
Lobbyists seem to be focused on the hearing of the upcoming draft bill which is supposed to be voted on in the coming weeks. The arguments from Rep. Patrick McHenry, chairman of the House Financial Services Committee, and Rep. Glenn Thompson, chair of the House of Agricultural Committee, state that the bill shall define when a cryptocurrency is a security and when it is a commodity.
#NEW: Chairman @PatrickMcHenry & @RepFrenchHill release a digital asset market structure proposal with @HouseAgGOP Chairman @CongressmanGT & @RepDustyJohnson in an unprecedented joint effort to provide clarity to the digital asset ecosystem.
Read more:https://t.co/089dV2SYng pic.twitter.com/pSIIVjfslU
— Financial Services GOP (@FinancialCmte) June 2, 2023
The bill, if passed, would provide more power to the CFTC, placing it way ahead of the SEC in regulating crypto assets. Another bill would also be discussed, which is supposed to provide a regulatory framework for stablecoins if the rumors of the agencies and lawmakers working on crypto regulations are true. The United States might soon have its own rules for the crypto industry.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
Source: https://www.thecoinrepublic.com/2023/07/11/crypto-lobbyists-push-democrats-for-crypto-regulations-in-u-s/