On the release date, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to the InvestorPlace.com Publishing Guidelines.
Crypto News Roundup: What Are US Officials Saying About Crypto This Week?
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The US government is rapidly expanding its influence over the crypto industry as we know it. Of course, there is a lot of legislation on the way. But even outside Capitol Hill, there are agencies that investigate the industry, hunt down criminals within it, and hold other agencies accountable for their roles. This week in particular is heavy with US crypto news.
US Securities & Exchange Commission (SEC) Chairman Gary Gensler is comfortable assuming a “heel” role for the crypto world. Gensler worries about the average investor — those who are at real risk if their investments fail in any way. Last week, the SEC chairman spoke about crypto legislation; Gensler says investor protection is of utmost importance. The SEC therefore works to ensure compliance across exchanges, lenders and brokers.
Now this week, Gensler is again talking about compliance – or rather the lack thereof. As the SEC creates its regulatory infrastructure for crypto, he notes “a lot of divergence” across the industry. Pointing to a number of failed crypto hedge funds and other companies as examples, Gensler says these firms would fall under “classic parts of the securities laws” in the traditional market.
The US Office of Government Ethics (OGE) is also working on crypto policy. Today comes a new installment in the form of a non-fungible token (NFT) advisory. OGE is asking officials to report all their NFTs worth $1,000 in value. It also asks these officials to disclose whether they purchased the NFTs with cryptocurrency or stablecoins.
The Department of Justice (DOJ) is also keeping busy in the crypto space. Yesterday, the DOJ announced that it has seized $500,000 in ransom and stolen crypto linked to the North Korea-backed hacking group Lazarus. So far this year, the group is responsible for more than $700 million worth of hacks.
Crypto News: Policy Talk on Capitol Hill
Congressional lawmakers also have plenty of crypto news to talk about this week. As regulatory politics begins to heat up again after a spring break, there are all kinds of stories. Some are going after the SEC, others are asking it to do more. And while one of the biggest crypto bills of the year could be subject to a delay, hopes of seeing a vote this year are not lost.
Not surprisingly, the two House representatives making opposing claims about the SEC are from opposite sides of the aisle. First, Republican Congressman Tom Emmer has a gripe with the SEC’s politicization of crypto policy. Emmer also hit out at the commission over its “industry visits”, challenging the body’s jurisdiction over the market. Emmer concluded his remarks by saying that these sweeps “discourage cooperation in good faith” between the company and the regulator.
Democrat Brad Sherman, on the other hand, says the SEC is not doing enough. Sherman criticizes the SEC for the lack of cases against major crypto companies such as Kraken and Binance (BNB-USD). He says the commission spends too much time pursuing “small fish”. In particular, Sherman referenced the SEC’s pursuit of Ripple (XRP-USD), saying that “the big fish running the big exchanges did many, many tens of thousands of transactions with XRP.”
When it comes to congressional bipartisanship, it’s a mixed bag of emotions. Senators Cynthia Lummis and Kirsten Gillibrand both say their bipartisan crypto infrastructure bill will likely be delayed until 2023, preventing them from getting the ball rolling on serious policy conversations. But noting recent bipartisan cooperation from the Congressional Agriculture Committee — which will vote on the bill next time — there is hope for the bill this year.
