The head of the US Securities and Exchange Commission (SEC), Jay Clayton, and his colleague from the US Futures Trading Commission (CFTC), Christopher Giancarlo, wrote a joint column for the Wall Street Journal about the problems of the crypto industry from the point of view of market regulators. In particular, the issue of the potential application of the existing regulatory and legal framework to regulate the economy of digital money was considered.
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As noted by Clayton and Giancarlo, many compare the technology of a distributed registry with a steam engine and a personal computer, which at one time became the driving force of the economy.
Initially, the Crypto-currencies were positioned as “an alternative to fiat money to accelerate payments,” however, market managers emphasize, their perception and promotion as investment assets adversely affects “their alleged function as a medium of circulation.”
Clayton and Giancarlo urged investors to be vigilant because of high risks, noting that some of the market participants do get a substantial profit. They also compared the boom of the crypto-currency market with the bubble of dotcoms in the late 1990s.
At the same time, they do not in any way try to convince consumers not to invest in innovation, because they believe that regulators should support technological progress. However, Clayton and Giancarlo are concerned that many crypto-exchange platforms do not meet the requirements of current legislation and are not even registered with the CFTC.
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Most such platforms position themselves as payment systems and are not subject to supervision by the SEC and the CFTC. Thus, officials believe, it is necessary to question the effectiveness of the existing regulatory framework. In addition, they remind us, federal legislation is not applied in all cases, which complicates regulation by federal authorities.
The launch of bitcoin futures for CBOE and CME was approved by the Futures Trading Commission, which obtained access to data to track unfair market activity. SEC, in turn, has focused its attention on the ICO market and “intends to actively pursue those who violate the securities laws.”
Summing up, Clayton and Giancarlo acknowledged that the blockage could increase the productivity of economic processes and lead to further technological progress in the financial sphere.
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