Senate committee starts work on regulatory crypto framework – MeriTalk

The state of cryptocurrency looks a lot different than it did just a year ago. While last year’s Super Bowl featured many crypto-focused commercials, last Sunday’s Super Bowl featured none.

The Senate Banking, Housing and Urban Affairs Committee held a hearing on February 14 to find out what has changed in the past year, and what regulations are needed going forward to protect the crypto and digital asset industries.

The Valentine’s Day hearing, titled “Crypto Crash: Why Financial System Safeguards are Needed for Digital Assets,” focused on where the committee might begin work on a two-pronged cryptocurrency regulatory framework.

“We have to ask ourselves, where do we go from here?” Ranking Member Tim Scott, RS.C., said in his opening statement. “As we move forward, we must take a thoughtful, bipartisan and balanced approach that protects consumers and promotes innovation and opportunity.”

Professor Linda Jeng, adjunct professor of law at the Georgetown Institute of International Economic Law, emphasized to members of Congress that right now is “a pivotal moment in history” where regulatory decisions will affect the future growth of the US economy.

“The type of car protection that you put in place now will affect generations to come,” Jeng said. “A lot of the issues you have to think about will include, certainly consumer protection, but also consumer rights and consumer power.”

“Currently, there are countries around the world that are also looking at how to take advantage of crypto technologies, China is a good example. But in that situation, it is the authorities that actually want to control the personal data, she continued. “Here is an opportunity for all of you to create the framework for consumer empowerment, for consumer data rights that serve as a foundation for the digital economy.”

Jeng also emphasized the importance of having a clear set of regulations that utilizes feedback from the public. She noted that to date, regulations throughout the public process have been lacking. And she explained that Congress needs to bring together all the best ideas on how to oversee the industry.

While senators are still working to gather ideas and decide what should be included in a cryptoregulatory framework, Sen. Robert Menendez, DN.J. that he has one main priority.

“The key element I would look for in digital asset legislation is a clear prioritization of transparency and investor protection, while ensuring stability and safe innovation,” Sen said. Menendez. “These are values ​​that make our current financial system strong and efficient, and should equally apply, I believe, to the digital assets.”

Similarly, Committee Chairman Sherrod Brown, D-Ohio, said the committee can start with “common sense principles” when looking at a rulemaking. These principles include clear disclosures and transparency, prohibition of conflicts of interest and insider self-dealing, internal governance and risk management, strong consumer and investor rights and protection, fraud prevention and supervision and oversight to hold companies accountable.

“Crypto is not special. We can start with these common sense principles when considering a regulatory framework for digital assets that puts consumers first and, above all, keeps our financial system safe,” the chairman said. “I trust that this committee, as the ranking member often says, can find common ground and work together to protect investors from crypto risk.”