Washington left-wingers are pushing for stricter regulations for Bitcoin and other virtual currencies. And, chances are, their agenda will get a favorable outcome in the Biden administration and Democratic-controlled Congress.
The Center for American Progress — a left-leaning think tank — is the latest body to call for the cracking down of cryptocurrencies.
Through a report issued on Monday, the center is mounting pressure on the Securities Exchange Commission (SEC) to impose tougher regulations on the crypto industry.
The report said SEC authorities should tighten the noose on blockchains to protect investors from fraud, tax evasion, and money laundering.
Gary is intent on expanding the SEC’s oversight on crypto
In a recent public commentary, Gary Gensler, SEC chairman, often refers to the cryptocurrency industry as “Wild West”. Gensler is a former lecturer of “Blockchain and Money” at the prestigious M.I.T (Massachusetts Institute of Technology).
He’s now more determined to expand the SEC’s oversight over the crypto industry.
In August, Gensler intimated that all cryptocurrencies including Stablecoins and stock tokens, are “subject to securities laws and must work within our securities regime”.
Congress talking tough on crypto
Democrats in Congress also want the crypto industry regulated. They’re calling for strict oversight and tax-reporting requirements on the cryptocurrency industry — mostly, to raise profits for legislative priorities.
Despite opposition from a section of Republicans, Democrats passed a bill last August that requires reporting of all crypto transactions. However, cryptocurrencies are difficult to completely regulate because no centralized authority sells or offers Bitcoin.
Stablecoins are a different cup of tea, though, because they derive a stable $1 value and receive backing from cash (such as dollars) and other high-quality reserves.
Unfortunately, issuers and backers of Stablecoins rarely disclose much about them — compelling regulators to want to crack down on Stablecoins fearing they’ll destabilize broader crypto markets.
The Treasury Department is about to issue regulatory frameworks on Stablecoins, forcing issuers to abide by the money-market fund and banking rules.
This week, the Federal Reserve is planning to issue a report on digital currencies, and layout what they think about creating a “digital dollar”. Chances are, the report will skip talking about regulating crypto, but may propel digital currencies into the limelight.
If you’re a crypto investor, brace yourself for a rocky week in cryptocurrencies. Digital currencies are under so much pressure. And the trend seems to remain shaky — judging from the latest Bitcoin fluctuating prices.
Bitcoin experienced an uptick of 1.5% to $48,686, on Monday — a 12.5% gain for the past week. The second-largest cryptocurrency, Ethereum, experienced a 1.2% dip to $3,380. But has since steadily soared to 11% for the past week.
