To Evolution

The US regulators They can ask Congress for legislation on virtual currency

    Abdulaziz Sobh
    By Abdulaziz Sobh

    Categories: Coins

    0/5 stars (0 votes)


    The US regulators They can ask Congress for legislation on virtual currency

    SEC Chairman Jay Clayton's comments to the Senate Banking Committee are the strongest indication so far that federal authorities are mulling over new laws to control virtual currency trading and investment.

    Clayton, who testified with Christopher Giancarlo, president of the Commodity Futures Trading Commission (CFTC), said the agencies were coordinating with the Treasury Department and the Federal Reserve on the matter, but added that lawmakers may need to clarify and improve regulatory powers.

    "It is possible that we will return with our friends from the Treasury and the Federal Reserve to ask for additional legislation," Clayton said when asked if Congress needed to act on virtual currencies.

    The hearing followed a defeat in the price of Bitcoin, which has lost almost half of its value since the beginning of the year due to concerns ranging from a global regulatory crackdown to a ban on the use of credit cards by some banks. buy bitcoin.

    Sen. Mike Crapo, the Republican chairman of the panel, and Democratic Sen. Sherrod Brown were among the lawmakers to express their concern about volatility, investor protections and the risks that cybercriminals present in the virtual currency market.

    "Among the enforcement actions carried out by its agencies, the international exchange trick of Coincheck ... there are examples that increase the concerns of investors," said Crapo, referring to the recent theft of $ 530 million by the hackers from the Japanese bitcoins exchange Coincheck.
    Both Clayton and Giancarlo used the audience to show the efforts their agencies have made to control the market and highlight the limitations in the current regulatory structure of the US. UU., Where the virtual currencies fall in a gray area between the SEC, CFTC, the Treasury, the Fed and the regulatory state.

    Federal legislation could help streamline this mosaic and clarify which agency has the authority to monitor the underlying cash market for virtual cash, regulators said.

    Giancarlo and Clayton cautioned, however, that while they had limited authority to write virtual currency rules, they would use their enforcement powers aggressively to protect investors from scammers.
    Clayton repeated his position that public offerings that comprise digital tokens, known as initial currency offers (ICO), are securities and are subject to the same rules of investor protection as the stock market offers.

    The SEC will prosecute lawyers and firms that try to circumvent those rules, he said, although he did not clarify whether the SEC would look for ICOs that have already happened.

    The CFTC is also working with the Federal Bureau of Investigation on money laundering and terrorist financing issues, said Giancarlo.

    "When word gets out that we will go after the bad behavior, I think it is beginning to see that reflected in the price" of bitcoin, he added.

    Regulatory chiefs questioned how their respective agencies would finance increased scrutiny of the rapidly growing virtual currency market, with Clayton saying he needed more people for the staff of the trade and markets division.

    "Staff is my biggest challenge at this time," he added.

    However, the committee members did not seem to have a clear position on whether to approve virtual currency legislation.

    Crapo noted that the underlying distributed accounting technology offered "a great present positive potential" to increase investor access to financial markets.

    Democratic Senator Elizabeth Warren, a consumer advocate, also used the hearing as an opportunity to question Clayton about other issues. These include reports that the SEC is reflecting on changes in the rules that would prevent investors from joining the defendants, an idea that Clayton said he personally is "not anxious" to pursue.

    On the Bitstamp stock exchange in Luxembourg, bitcoin rose 1.2 percent to $ 6,959.00 in afternoon trading in New York on Tuesday. The US stock markets UU They were mixed in a volatile operation after two days of heavy losses.