“We don’t need knee-jerk reactions by lawmakers to regulate out of fear
of the unknown rather than seeking to understand,” said Representative
Patrick McHenry.
The House Committee on Financial Services heard from several CEOs of
major crypto firms in the United States, some of whom seemed to present a
united front in urging lawmakers to provide a clear regulatory
framework for crypto.
Speaking at a Wednesday hearing titled
“Digital Assets and the Future of Finance: Understanding the Challenges
and Benefits of Financial Innovation in the United States,” Circle
CEO Jeremy Allaire, FTX CEO Sam Bankman-Fried, Bitfury CEO Brian
Brooks, Paxos CEO Chad Cascarilla, Stellar Development Foundation CEO
Denelle Dixon and Alesia Haas, chief financial officer of Coinbase and
CEO of its U.S. subsidiary, told U.S. lawmakers about the challenges their companies faced as both stablecoin issuers and digital asset exchanges.
In a written statement released prior to the hearing, Allaire said
Circle supported Congress’ efforts for “national licensing and Federal
supervision” of stablecoin issuers, given many were now “too big to
ignore.” Cascarilla seemed
to echo this sentiment, describing the U.S. financial system as
“inadequate” for handling the emerging digital economy, but blockchain
technology may offer a possible solution:
“A blockchain-based
financial architecture could settle trades on the same day, mitigate
counterparty risk and eliminate the costly central clearinghouse,” said
the Paxos CEO. “This would enable market participants and regulators to
monitor and correct settlement and margin shortfalls in real time. We
agree that shortening the trade settlement cycle should be a high
priority for the SEC, and we are working aggressively to make that
possible.”
Brooks added
that there were already examples of companies involved in the digital
asset space finding a more regulatory-friendly environment in other
countries, such as Fidelity launching a Bitcoin (BTC) exchange-traded fund in Canada in the absence of the U.S. Securities and Exchange Commission’s approval of one.
“There
is a reason why crypto talent is no longer concentrated in Silicon
Valley, the birthplace of the original commercial Internet,” said
Brooks. “Sure, some talent has merely moved from Silicon Valley to Miami
— but a surprising number of talented founders have left for Portugal,
Dubai, Abu Dhabi, Singapore, and other jurisdictions that are not at all
unregulated but that have a more positive posture toward innovation and
growth.”
Addressing
the panel of crypto CEOs, Representative Patrick McHenry argued the
technology in the crypto space was “already regulated” but acknowledged
that any existing framework could be “clunky” and “not up to date.”
According to the North Carolina congressperson, a lack of understanding
among his fellow committee members could risk overregulating crypto and
blockchain:
“We need reasonable rules of the road, we
know that. We don’t need knee-jerk reactions by lawmakers to regulate
out of fear of the unknown rather than seeking to understand. And that
fear of the unknown in the move to regulate before understanding will
only stifle American ingenuity and put us at a competitive
disadvantage.”
Still ongoing at the time of publication, the House committee hearing seeks to discuss four key aspects
of the crypto space: exchanges, stablecoin offerings, regulatory
concerns in digital assets, and federal regulatory responses. Lawmakers
will also likely discuss decentralized finance, given its potential to
“replicate and replace conventional delivery of financial services such
as loans, asset trading, insurance, and other services.”
source link : https://cointelegraph.com/news/crypto-ceos-request-congress-provide-regulatory-clarity-at-hearing-on-digital-assets
