Amid the growing demand for crypto regulations in the United States, policy experts suggest more wait in the path ahead. While the Congress has witnessed several crypto regulation bills, experts have cited that getting a bill to the president’s desk may only be the start of the battle.
Recently, Dorothy DeWitt, federal policy expert, warned crypto companies that even if policy advances, rules can take a decade or more to pass. DeWitt served as former chief finance counsel to the Senate and former director of the division of oversight in the Commodity Futures Trading Commission (CFTC).
While attending a panel discussion in New York hosted by Lowenstein Sandler law firm and Rutgers law school recently, DeWitt highlighted the the tedious process of rule making stating that “rulemaking takes forever.” Further, she pointed to the Dodd Frank Act, which was published in 2010, but its final rules were not passed through the CFTC until 2021. She added:
“It’s really hard to get folks who have little interest [and] little understanding and who are afraid of really complex issues to come together.
Notably, DeWitt has a significant contribution to the US politics and is no stranger to the Capitol Hill. She had also helped draft the Responsible Innovation Act, a bipartisan bill aimed at creating a clear regulatory framework for digital assets, sponsored by Senators Cynthia Lummis, (Republican-Wyoming), and Kirsten Gillibrand, (Democrat-New York), last session. The bill has not made the rounds this Congress, but the senators have expressed interest in re-introducing a revised version.
Addressing consumer protection, market integrity, anti–terrorism policy and promoting innovation, DeWitt said the bill is “comprehensive,” and deemed all the listed issues essential for such legislation to make it through Congress.
Simultaneously, amid the US Securities and Exchange Commission’s (SEC) crackdown on crypto entities, another legal expert has assessed the role of the regulator in the same event. James Park, a professor at UCLA School of Law, said the SEC faces similar challenges when it comes to creating and enforcing rules around evolving technology like crypto. Additionally, he said, there’s a simultaneous jurisdictional battle.
There’s a question of ‘is it the SEC, the CFTC or something else? Is there something about crypto that the current exchange rules, for example, are just not willing to work with respect to various crypto [companies]? And that’s something I think the SEC is going to have to figure out.
While the crypto industry is echoing with the importance of crypto regulation, the expected delay puts the question of challenges that the industry will be forced to face in the meantime. As the SEC continued its enforcement spree, the implementation of clear framework has emerged as a necessity.
Last week, Senator Lummis emphasized that she is working on a regulatory framework that will enable individuals and companies to own and trade digital assets in America. Additionally, the lawmakers have also engaged in the process of crypto regulation with the preliminary discussions however the end results are far fetched.