Summary
Republican lawmakers have sent a letter to U.S. Treasury Secretary Janet Yellen seeking clarification on how cryptocurrencies should be defined at the federal level. They also asked about coordination between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The lawmakers expressed concern that regulators have not created an environment that ensures consumer protection and fosters digital asset innovation in the United States. They specifically mentioned the court case involving Ripple Labs and the SEC, asking FSOC’s views on how securities laws apply to “crypto-asset issuers.” The lawmakers also inquired whether both bitcoin and ether are considered securities and whether expanding the CFTC’s jurisdiction to encompass the spot market would be appropriate. The co-signers of the letter are also leading an effort for a bill called the Financial Innovation and Technology for the 21st Century Act, which aims to regulate crypto comprehensively. Yellen, in her testimony, called for Congress to pass legislation to regulate stablecoins and the spot market for crypto assets. She highlighted the regulatory gap regarding spot markets and expressed concerns about stablecoins posing risks to the financial system.
Key Points
1. Republican lawmakers sent a letter to U.S. Treasury Secretary Janet Yellen seeking clarification on how cryptocurrencies are defined at the federal level, specifically regarding the Financial Stability Oversight Council’s role in this determination.
2. Lawmakers inquired about coordination between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), both of which have members in the FSOC. The FSOC has highlighted regulatory gaps in the spot market for digital assets and recommended granting rulemaking authority to financial regulators.
3. The lawmakers expressed concerns about the lack of consumer protection and hindered digital asset innovation in the United States. They also raised questions about how securities laws apply to crypto-asset issuers and whether bitcoin and ether should be classified as securities. Additionally, they mentioned their efforts to pass the Financial Innovation and Technology for the 21st Century Act, which aims to regulate cryptocurrencies comprehensively.