Tag:Digital Assets
Upcoming SEC Turmoil: What It Means for the Cryptocurrency Industry
The early October resignation of Gurbir Grewal, the Director of the Division of Enforcement at the U.S. Securities and Exchange Commission (SEC) sent ripples of (false) hope through the cryptocurrency industry. Grewal played a key role in shaping the SEC’s enforcement agenda; although his departure will likely not alter the SEC’s approach to digital assets, the upcoming election may affect the cryptocurrency industry’s interests.
Regulating the Unregulated: Where is Cryptocurrency Headed?
While over 10 years have passed since Satoshi Nakamoto first introduced Bitcoin, digital currencies continue to remain unregulated by financial authorities despite a number of challenges that have plagued consumers and the government: the Silk Road, fraud, and various other financial crimes. Additionally, many consumers invest in cryptocurrencies because they are not controlled by any central government monetary policies. However, cryptocurrency investors are also at risk of their money losing its value when the market takes a tumble, as evidenced by the recent current cryptocurrency downturn. Despite these continued challenges, imposing regulations on cryptocurrencies has proven to be difficult. Until President Biden’s Executive Order, issued on March 9th of this year, the White House steered clear of recognizing digital assets as a valid form of currency. The President’s Order explicitly recognized the need for research and policy implementation across various government agencies in order to shape the way cryptocurrencies are regulated.
Coinbase Proposes a New Regulator to Oversee Digital Assets After Feud with SEC
In October 2021, the cryptocurrency exchange platform Coinbase released a proposal for a regulatory framework that would designate a single regulator for the digital asset markets. This proposal comes less than a month after Coinbase’s CEO had a public meltdown on Twitter after the Securities Exchange Commission (SEC) sent the firm a Wells Notice, a warning of potential litigation, about their planned cryptocurrency lending platform allegedly violating securities regulations. As the digital asset market grows and the financial institutions involved become more influential, regulators continue to struggle with jurisdictional and definitional questions around the new products.