Following a U.S. legislative hearing on cryptocurrencies, a leaked internal letter circulated among Democratic members of the House Financial Providers Committee demonstrates that they support for the U.S. Securities and Alternate Fee (SEC) to be the primary regulator for cryptocurrencies.
According to Ron Hammond, director of government relations at the Blockchain Association, the plan did not receive support from a majority of Republicans on the committee, who preferred commodities futures for cryptocurrencies like bitcoin and Ethereum. The Commodity Futures Trading Commission (CFTC) monitors commodity spot markets on an interim basis.
Republicans also support Congressional participation in defining digital securities and commodities. Meanwhile, most Democrats argue that the majority tokens be classified as securities. The idea is still in its early stages, and the Republican committee has yet to formally submit a stablecoin invoice.
Nonetheless, if the Democrats’ plan is implemented, it will be an important step towards clearing the bitcoin regulatory landscape and, without a doubt, pushing the industry closer to the SEC, the first U.S. securities regulator.
Some cryptocurrency experts have raised worry about the SEC’s ability to oversee the crypto market, which is constantly growing and has unique issues. However, supporters of the plan claim that placing the market under the SEC’s supervision will provide better protection for dealers and help establish clearer and consistent norms for digital assets.
Regulatory transparency has been an increasingly pressing issue in the aftermath of several high-profile problems concerning cryptocurrencies, such as the failure of some stablecoins and the use of encryption in ransomware attacks.
