U.S. Regulatory Agencies to Regulate ICOs
The world’s largest business group, the US Chamber of Commerce, is demanding clear regulations for cryptocurrencies and any activities related to them, including Initial Coin Offerings (ICOs).
The request stemmed as a part of the new FinTech Innovation Initiative of Chamber. The Chamber released its first report last week which outlined eight FinTech principles to be presented to legislators and regulators.
The Chamber urged the Securities and Exchanges Commission (SEC) in its report to continue studying ICOs. The study needs to be done to see how they can be an effective tool for raising capital while protecting investors and meeting all the applicable laws. The Commodity Futures Trading Commission (CFTC) also got recommendations from the Chamber to study how cryptocurrencies are functioning in the futures and commodities market.
The report said :
“In both cases, we urge the agencies to regulate the products and services enabled by the technology instead of the technology itself. This approach would alleviate contradictory and overlapping rules, and allow institutions to focus on what really matters – reducing consumer risk and preventing fraud.”
The demands by investors and executives in the US digital currency sector lead to the call of Chamber for regulatory clarity in the crypto sphere. As per a recent survey by US-based law firm Foley & Lardner, “72% of the actors on the country’s crypto market believe there is no well-grounded understanding of how current federal and state regulations of financial markets are applied to digital coins.”
But despite the urge for increased crypto regulations, there is still no conclusive definition-based framework in the US for the regulation of cryptocurrencies. Dispute over the classification of the digital currencies as commodities or securities have increased pressure within the industry and questions regarding the proper authority in charge of the regulation of the sector still persists.
The Chamber also recommended the Consumer Financial Protection Bureau (CFPB) that it should adopt a robust no-action letter and advisory opinion process that gives innovators the opportunity to receive regulatory certainty they need to be successful.
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