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For more than 4 hours, some 80 Wall Street investors, delegates from the cryptoactive companies, representatives of the Chamber of Commerce and a commission from the U.S. Congress debated on Capitol Hill about the implementation of a regulation that would allow them to continue innovating and not lag behind other countries, which already have regulatory frameworks that promote the expansion of the ecosystem.
Executives from companies such as Coinbase, Circle, Kraken and Consensys complained that, for example, a 72-year-old securities law is being applied to crypto currencies. The proposal put on the debate table the actions taken by the Securities and Exchange Commission (SEC) to determine whether or not a crypto currency is considered a security. This regulatory body uses what is known as the 1946 “Howey Test,” which comes from the U.S. Supreme Court.On this point, Carla Carriveau, Circle’s legal adviser who worked for the SEC for 10 years, stressed that while the agency can make decisions to clarify laws and make some exceptions, it is Congress that has the power to make a real impact. “Congress has to act because the SEC has already said what they think is right, they have already done what they had to do,” she said.What Carriveau said opened the door for legislators to consider new regulatory schemes in the face of a nascent technology that does not fully conform to the traditional molds currently in use, but is likely to require a custom-made one.
Another representative of the cryptoactive companies who took the floor was Mike Lempres, Coinbase’s legal and risk director, who stated that the new platforms require greater openness for their proper development.We all want fair and orderly markets, we want what regulators do. It doesn’t have to be done in the same way as in the past, we have to be open to that.Mike LempresLegal and Risk Manager, Coinbase. The delegates’ main fear is that the U.S. cryptoactive industry will be left behind because incorrect decisions were made or because they came at the wrong time, which could lead to a migration of companies and human talent to other nations that have established laws and regulatory frameworks to foster this branch of the digital economy.
Joyce Lai, an attorney at Consensys, said that “competition around the world is real, but there is still time and opportunity for the United States to be a leader here.The North American country concentrates several exchange houses of crypto coins with important volumes of exchange on a global scale. In addition, thousands of developers have settled in cities like San Francisco to carry out their projects related to this technology. However, with the opening and easing of the laws in Malta or South Korea, for example, this scenario could change in the medium term.For Jesse Powell, co-founder and CEO of the Kraken exchange house, the scenario for U.S. competitors would be compromised by the advances that have occurred in recent years in other latitudes.
Foreign companies can outperform U.S. competitors, and often the one who wins the most money is the one who wins. Not only can U.S. companies not raise enough money to compete globally, but U.S. investors cannot invest in these global companies.Jesse PowellCo-founder and CEO, KrakenThe Congressional committee that participated in the meeting was made up of Warren Davidson (Ohio), who served as host, Ted Budd (North Carolina), French Hill (Arkansas), Darren Soto (Florida) and Tom Emmer (Minnesota). Legislators will now prepare a bill that would include the issues discussed Tuesday in Washington.
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