A recent panel at CoinDesk’s Consensus 2018 conference in New York saw key U.S. regulatory figures discuss the ideal way of approaching digital assets. The panel featured notable lawmakers such as CFTC enforcement director James McDonald, SEC Enforcement Division Cyber Unit chief Robert Cohen, as well as associate deputy attorney general Sujit Raman.
Also in attendance was Kiran Raj, the chief strategy officer at Bittrex, one of the largest crypto exchanges. With attorney Steve Bunnell moderating the panel, the group addressed the dangers of over-regulating blockchain, agreeing that a lighter touch would be optimal in order to stimulate innovation.
Cohen noted that the Securities and Exchange Commission (SEC) only regulates financial markets, not the technology itself. With this in mind, he underlined that his agency is wholly open to token launches and encourages innovators in the field to discuss their ideas with the SEC for the benefit of both parties. Cohen added that the commission also doesn’t want to inhibit a startup’s ability to raise capital, so long as the token sale is authentic.
He further explained that the SEC’s main focus is weeding out fraudulent token sales through a lack of compliance on the developer’s part. In his opinion, existing safeguards implemented by the SEC have already made the cryptocurrency market more appealing to investors.
McDonald sported a similar tone, stressing the importance of achieving a healthy market environment through sensible regulation. In line with his colleague, he emphasized that the Commodities Futures Trading Commission (CFTC) wants to avoid hindering blockchain-related developments whenever possible.
Raman elaborated on the Department of Justice’s role in crypto regulation, noting that any interference from the Department of Justice in the crypto market would involve cases where there is a potential threat to Americans, whether from a national security perspective or otherwise.
Raj expanded upon the importance of carving out guidelines that prevent fraud while allowing growth in the market. The strategist said that, in the future, he would like to see laws that add more certainty to token launches and transactions, along with a way to reduce or eliminate dishonest practices in the industry.
The panel members went on to talk about the classification of digital assets, reaching a consensus that they should be viewed as securities. Cohen and McDonald also said that their respective agencies are working with participants in the industry to determine the best course of action for creating constructive regulatory practices.
Overall, the meeting can be seen as a significant step forward for cryptocurrencies, and it should provide comfort to crypto investors and innovators alike that regulators agree that blockchain technology should be allowed to develop unhindered.
Other federal regulators agree with this positive outlook on blockchain. Read the CFTC chairman’s comments about the value of Bitcoin as a long-term asset for investors.