Critics around the globe have been concerned regarding the regulation of crypto and the implementation of a framework citing the same.
In a recent interview, Tonya Evans, a law professor at the Pennsylvania State University, presented her views on the current crypto market scenario and spoke in relevance to the required regulations.
The legal expert briefed the publishing house that she believes the crypto sector is currently “at the brick wall stage and is forcing the hand of legislators to amend legislation.” Her statement highlights the need for essential changes in the regulation that the presently dwindling market requires.
However, Evans expresses her positive views on the sector’s regulation. She says she is “cautiously optimistic and hopeful” for a federal crypto regulation in the upcoming year.
Evans also highlights that the collapse of the crypto exchange FTX has triggered the regulators globally, and she can see regulations being established very soon.
“I do see regulation coming.”
The legal expert also calls on Congress to proactively establish more precise regulations for the digital assets sector. However, she also acknowledges the recent buzz around optimum regulation of the sector.
She mentions the recent congressional testimony of Rostin Behman, chairperson of the Commodity Futures Trading Commission (CFTC). She states that “there’s a lot of thoughtful consideration to the right balance” of the regulatory framework. The CFTC chair’s congressional testimony sought more authority for the organization to regulate the digital assets sector and not just be limited to the derivative markets. Earlier in October, Christy Goldsmith Romero, commissioner of CFTC, also asked for more authority to oversee the sector.
On being asked her opinions for the investors and customers relying more on centralized firms like FTX, Evans highlights the need for optimum transparency. She says there is a need for federal guardrails, i.e., legal accountability, protection, and greater transparency.
Evans prioritizes efficient and effective regulation of the crypto sector over the rigid body in charge. She says that regulation is more important than the fact that the regulatory power lies in the hands of one regulator or is shared by both. The agencies or regulators mentioned here are the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission. She also urges Congress to play its role and ensure that efficient legislation and regulation are created and implemented.
“Congress must ensure the right legislation and regulation is created for the times.”
She also highlights that the US regulators have been dealing with crypto regulation in the country for a while, but with the collapse of the FTX, they have no option left. The implementation of regulation after the incident is inevitable, given that the funds of many citizens were jeopardized.
In the US, there has been strife between the SEC and CFTC regarding regulating crypto assets. While SEC considers Bitcoin and other cryptocurrencies a security, CFTC counts them as commodities. In May, Rostin Behnam, the CFTC chair, called Bitcoin and Ethereum commodities but, in a recent interaction, changed his stance and only called Bitcoin commodity. However, CFTC has been considered to have a more lenient approach towards crypto compared to SEC, an image that the organisation isn’t quite proud of.
Recently, Romero, CFTC’s commissioner, suggested that the CFTC should divide retail customers into two groups to provide each category with additional protections.