The United States has gotten a lot of attention for its lack of regulation clarity regarding cryptocurrency (digital assets). This has forced much of the innovation to head out of the country since companies have no idea what is legal and what is not.
We also have an Administration, at least the President himself, who is against Bitcoin. On a number of occasions he verbally attacked it.
His SEC is also none-too-friendly to those companies that engaged in crypto fundraising through the ICO craze. They have gone after a number of companies that engaged in legitimate practices, i.e. non-scams. Nevertheless, since they were not authorized to sell securities, the end result is, according to the SEC, they broke the law.
That said, it is interesting to note that, in spite of not being openly pro-Cryptocurrency, the Administration does have crypto well represented.
Presently the CFTC and OCC are heading by people who are favorable to cryptocurrency and have a background in the industry. This could be trumped by a move that could see the head of the SEC being a pro-crypto advocate.
Hester Pierece is affectionately known as "crypto mom". In here time at the SEC, she has advocated for Bitcoin and other digital assets. She routinely votes in favor for a Bitcoin ETF, something that has yet to pass. Her term is ended but the President nominated her for another term.
While this nomination, which is likely to get through the Senate is for her existing seat, there is a chance that she could have the inside track as head of the agency. Jay Clayton was nominated by Trump to be Attorney for the Southern District of New York. This could get political and might throw a monkey wrench into things.
If that somehow does go through, Hester could then be put up as head of the agency, putting a crypto ally in a powerful position.
Hester is not real keen on applying 80 year old laws to the technology of today. She has openly asked the validity of the Howie Test in regulating digital assets. While it is a security according to the law, Hester feels that things can be handled in a different manner.
One of her main proposals is to provide a three year window for projects to decentralize. Realizing that these types of initiatives start out centralized, her view is the goal is to move towards decentralization. The window would provide the time for projects to innovate while following a path towards becoming a non-security.
My personal view is the longer this takes to sort out, the better it is for individual cryptocurrency holders. With each passing day, we see more tokens in the hands of individual owners. To me, this means that individual wealth tied to digital assets is growing. This makes the entire spectrum more powerful.
At some point we get to the point of absurdity where the idea of banning cryptocurrency will be moot. If there are tens of millions of people holding crypto, they are not going to give that up because the government says to do so. A small handful might fall in line but a big percentage of the population, well the law gets ignored. The debate over cannabis showed us how things transpire.
Right now Washington seems to have a rather neutral posture towards cryptocurrency. It is not openly helping it out yet it is not hindering it either. The lack of regulatory clarity might be hindering innovation but it is not harming individual token holders.
Thus, we have to conclude there is some hope for the United States with regard to cryptocurrecny and digital assets.
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