US House committee proposes new crypto legislation with one key difference
On Tuesday morning, the US House Financial Services Committee will hold a hearing on the Securities and Exchange Commission’s oversight of digital assets. While most hearings turn out to be indecisive and mundane, this one in particular could turn out to be quite an important one for the larger crypto market.
The House Committee calls out regulators
While speaking in an interview with a leading media outlet – Patrick McHenry – Chairman of the US House Committee on Financial Services, he claimed that the financial regulators failed to put forward a convincing but robust regulatory framework for crypto businesses. Due to the lack of clear guidelines and widespread deregulation in the country, several crypto firms have been exposed to moving their operations offshore. The Coinbase CEO’s latest statement about the possible move sent shock waves across the market earlier today.
Read more: Gary Gensler ‘Couldn’t Explain How Crypto Firms Should Comply’
In addition, McHenry clarified that the House committee looked forward to proposing a new crypto regulation that would explicitly establish the nature of cryptocurrencies and would finally put an end to the ongoing debate between commodities and securities. The North Carolina representative was quoted as saying:
The legislation will provide a distinction between what is a good and a security in the digital realm and the digital and the digital asset ecosystem.
SEC chief grilled over crypto crash
As the hearing continues at the time of writing, Republicans on the House Financial Services Committee have criticized the agency’s head, Gary Gensler, calling his approach to crypto firms “not compatible” with the law as it stands.
Gensler has stated on several occasions that he is confident his agency possesses the jurisdiction it requires to oversee cryptocurrency, and he has advocated that all cryptocurrency exchanges must comply with the regulator. More recently, enforcement action against companies such as Beaxy and Bittrex involves him considering exchanges to register as a “national securities exchange, broker and clearing house”.
On the other hand, a group of representatives, including the vice chairman of the House Financial Services Committee and the chairman of the Financial Services Subcommittee on Digital Assets, sent a letter to SEC Chairman Gary Gensler regarding his regulatory inconsistency in his treatment of spot bitcoin exchange applications for traded products (ETP).
Also read: Critical vulnerabilities in iOS and macOS risk loss of crypto assets
