New Proposed Bills To Lookout For That Can Change The SEC’s Crypto Plans• May 9, 2022 10:50 pm • Comments
As many within the crypto community already know, the SEC had recently announced that they would be expanding the number of staff on their crypto enforcement units.
This likely means that the SEC is planning on continuing to do its enforcement actions on the crypto industry which many have criticized as the committee over-regulating crypto and going beyond its domain of regulatory authority.
Recent enforcement actions that have made the news in the past include the SEC’s fine on Nvidia regarding its crypto mining business as well as the long standing lawsuit with Ripple regarding XRP.
As a result of all of this, even some members of Congress have started to put pressure on the SEC and there are now a number of new bills that many crypto investors should be on the lookout for.
Approval of these bills may possibly change the regulatory environment for the better, but many need to be aware of them first.
Today we announced that we’re bolstering the unit responsible for protecting investors in crypto markets & from cyber-related threats. The newly renamed Crypto Assets & Cyber Unit in the Division of Enforcement will grow to 50 dedicated positions.
— U.S. Securities and Exchange Commission (@SECGov) May 3, 2022
This enforcement trend isn’t likely to slow down, particularly after the new hires, but the SEC could use its rulemaking powers to offer more clarity in certain areas to reduce the need for enforcement, at least until Congress defines the agency responsibility for crypto oversight.
This may be happening sooner rather than later. U.S. lawmakers are introducing new legislation to clearly define the roles of the SEC and the CFTC on cryptocurrency oversight.
On April 28, Republican and Democratic lawmakers introduced the Digital Commodity Exchange Act of 2022 in the House, which would extend the CFTC oversight powers to cryptocurrency activities via digital commodity exchanges.
This bill, however, doesn’t go as far as providing the CFTC with authority to supervise any type of digital asset, as the SEC still has jurisdiction over cryptocurrency assets deemed securities or over digital assets that represent some form of ownership or investment in a business.
Besides the bill that might possibly given the CFTC more power when it comes to regulating the crypto and digital asset industry, there is also another bill that is on the radar that may help.
Senator Cynthia Lummis has recently introduced a new bill that aims to provide more detailed regulation on taxation, payments, and digital asset definition.
That last part is extremely component as there is currently no clear guideline today that determines whether a crypto is considered a digital asset or a security.
As a result of not having a clear legal definition, it is then vulnerable to open interpretation by the SEC which many have accused the SEC of picking winners and losers within the crypto industry.
The SEC is a regulatory agency with an enforcement division, not an enforcement agency. Why are we leading with enforcement in crypto?
— Hester Peirce (@HesterPeirce) May 3, 2022
With over 4,800 employees working at the SEC, a team of 50 people working on the cryptocurrency unit could hardly be seen as an attempt to turn the agency into an enforcement agency, but Pierce has made a valid point.
In cryptocurrency, the number of enforcement actions — currently standing at 80 — clearly outweighs the new regulation or guidance adopted by the agency, which is close to none.
Another long-awaited bill is the one to be introduced by Sen. Cynthia Lummis, R-Wyo.
A longtime bitcoin owner, Sen. Lummis is expected to introduce a crypto-friendly bill in the coming weeks that will include detailed regulation on taxation, payments and most importantly, on digital asset definition that would help define the roles of the different overseeing agencies.
It is very clear that we need clear guidelines going forward before any regulatory agency can even start ‘enforcing’.
These Bills Could Change SEC’s Crypto Enforcement Trend – https://t.co/q3kSE2bGtB
— Crypto&NFT&Metaverse NEWS (@additionalrules) May 9, 2022
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