Takeaways from the U.S. Congress & SEC crypto-focused hearing session
NEWS
September 26  |  2 min read

Main Takeaways from SEC and U.S. Congress Hearings on Cryptocurrency Regulation

The COIN360 Editorial Team

On Sept. 24, The US House Financial Services Committee had an informational hearing on cryptocurrency regulation with several representatives of the Securities and Exchange Commission (SEC), which evolved into a fiery exchange of general views and opinions without a trace of a somewhat clear outcome.

The SEC was represented at the hearing by its chairperson, Jay Clayton, and four other commissioners, including Hester M. Pierce, nicknamed “Crypto Mom” for her friendliness towards crypto.

There was no lack of diametrically opposing views concerning the possible status of cryptocurrencies. For instance, Rep. Brad Sherman, who is known for his extremely hawkish attitudes towards crypto, stated that “The U.S. dollar is extremely good currency [...] It fails, however, to meet the needs of tax evaders, sanctions evaders, drug dealers, and terrorists.”

Speaking from the opposite side of the table, Commissioner Hester M. Pierce warned her colleagues against “overriding investor preferences” and making decisions for investors, while also emphasizing the need for “regulatory humility” regarding crypto.

However, polarized opinions aside, the majority of the participants in the debates were expressing their concerns about the long-lasting legislative uncertainty regarding the crypto space in general and cryptocurrencies in particular.

For instance, while referring to the much-discussed July release of the white paper for Facebook’s Libra tokens, Chairman of the SEC, Jay Clayton, pointed to the superficiality of the SEC’s approach:

“I think statements like ‘if it doesn’ produce a return, it’s not a security’ — I think that’s a bit of an oversimplification. [...] A lot of lawyers will spend a lot of time figuring out just where that line is,” – he noted.

Earlier today COIN360 reported that Facebook founder Mark Zuckerberg recently outlined Facebook’s new approach to launching projects, citing Libra as an example of the new strategy and admitting that the high-scale initiative is going to be “sensitive for society,” though still stonewalling on the exact launch day of the project.

Meanwhile, the predominant mood was expressed by Rep. Anthony Gonzalez, who urged the SEC to “go faster” with drafting regulatory norms for crypto space while noting that innovation in crypto was leaving the U.S. due to lack of regulation.