Future of crypto market will be decided in 2023
2022.12.20 03:17
Future of crypto market will be decided in 2023
Budrigannews.com – Instead of deferring to unelected regulators at the Securities and Exchange Commission (SEC), it would be ideal for the industry for Congress to weigh in on its fate. To that end, bills to provide “regulatory clarity” have been introduced by representatives from both parties. Cryptocurrency seems to be best served by the Commodity Futures Trading Commission (CFTC), according to moderate opinion.
There are, without a doubt, two particular Senate bills that are not ideal.
Debbie Stabenow, chair of the Democratic Senate Agriculture Committee, and Republican Sen. John Boozman have co-authored one proposal. Following the collapse of FTX, Stabenow states that the bill is “definitely a priority” and that the committee will act on it next year.
The CFTC would have jurisdiction over cryptocurrencies under the Stabenow-Boozman bill, which has broad bipartisan support. Vote based Representative Cory Booker and Conservative Congressperson John Thune have additionally endorsed on to the bill. The CFTC would require the registration of all crypto trading platforms—brokers, dealers, and custodians—if it passes. Minimum capital requirements and bankruptcy protections would be implemented, and exchanges would report to the CFTC.
Insiders of the cryptocurrency industry frequently voice one criticism: A more precise definition of commodities and securities needs to be included in the bill. Will the Howey test or another method be used to evaluate digital securities? The bill lacks clarification. Additionally, the bill runs the risk of being interpreted as a de facto prohibition of DeFi.
Leaving non-elected bureaucrats and courts to decide on a case-by-case basis whether digital assets are security is not a good strategy. The United States should avoid rulemaking through enforcement and let Congress decide what makes a digital security distinct from a commodity.
The bill adds “digital commodity” to the definition of a commodity, but it does not specify which cryptocurrencies are securities.
The Responsible Financial Innovation Act of Lummis-Gillibrand
The Stabenow-Boozman bill isn’t the main Senate proposition sitting on the agenda for the following year. Additionally, Democratic Senator Kirsten Gillibrand and Republican Senator Cynthia Lummis have drafted a comprehensive bill that would establish standards for advertising, investor protection, and consumer protection.
Before joining forces with New York Senator Kirsten Gillibrand to introduce the Responsible Financial Innovation Act (RFIA), Lummis had established a reputation as a “pro-crypto” advocate. The term “ancillary asset,” which is new in the bill, sounds like a utility token. The token needs to be fungible in order to be considered an ancillary asset. Individuals for the most part appear to see the bill as really great for crypto.
Despite the fact that the cryptocurrency industry has been around for about ten years, there are still demands for “regulatory clarity.” However, wouldn’t the industry have been informed if the SEC had known which ones were securities? Perhaps not even the SEC knows where the line should be drawn. On the off chance that you took a rundown of the main 20 digital forms of money to five different significant law offices with experience in crypto, they would all probably express various impressions about which would be considered protections.
While the SEC receives a lot of attention, numerous organizations undermine crypto’s true ethos. These include the Department of the Treasury, the Financial Crimes Enforcement Network (FinCen), and the Office of Foreign Assets Control (OFAC). Cryptocurrency is undermined by figures from our own industry. Sam Bankman-Fried, who was taken into custody in the Bahamas and is scheduled to be extradited to the United States, argued that interfaces to protocols ought to be gated by licenses and that it is important to understand the laws of your customers.
More Co-founder of FTX will return money to customers
That makes it impossible for anyone who lacks the $100,000 necessary to obtain a preliminary legal review to participate in the industry, which stifles creativity and ingenuity. Financial services could only be provided by large businesses. Legislation that restricts crypto’s openness must be resisted by the industry.
In 2023, which could be crypto’s defining year, a number of crypto-related bills will be up for debate in the US House of Representatives. Now is the time for the industry to become more diligent in ensuring that stringent regulations do not result from events that occurred during the crypto winter.
Kadan Stadelmann is the chief technology officer of the Komodo Platform and a blockchain developer. After earning a degree in information technology from the University of Vienna in 2011, he went on to study technical informatics and scientific computing at the Berlin Institute of Technology. He joined the Komodo group in 2016.
This article is for general informational purposes only and should not be interpreted as investment or legal advice. The author’s views, thoughts, and opinions are their own, and they do not necessarily reflect or represent those of Cointelegraph.
