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- Official letter that was sent to the SEC read that the policy makers must strive to declare the legalization regarding the cryptocurrencies.
- Over the Counter (OTC) is the only form of trading where they can sell or buy cryptocurrency without the head-ache of regulations.
Cryptocurrency users have demanded clarification in the regulatory measures for a long time now. Recently, an ensemble of lawyers drafted an email to Jay Clayton, the chairman of the US Securities and Exchange Commission (SEC) requesting enhanced information regarding the use and guidelines of the cryptocurrency. Apart from them, a handful of other congressmen have inquired Clayton to announce the plan of the SEC if any. One of the official letters that was sent to the SEC read that the policy makers must strive to declare the legalization regarding the cryptocurrencies which are securities and which are not.
Classification of Assets on the Basis of Securities or not
The regulatory uncertainty to some extent has hindered the growth of cryptocurrency adoption in the US. For traders it becomes very difficult for them to engage in crypto investments without knowing which asset classifies as security and which doesn’t. Hence, Over the Counter (OTC) is the only form of trading where they can sell or buy cryptocurrency without the head-ache of regulations and so on. This is because OTC allows you to trade directly from peer to peer without requiring any competent authority.
Institutional Investors may act as a Catalyst in the Process of Cryptocurrency Regulation
However, in order to expand the spread of the digital asset industry, there is a need for proper utilisation of the institutional interest. Not only will it enhance the digital asset market but also will provoke the SEC, the policy makers to act quickly to the needs of investors. The reason behind this simply lies in the fact that organised and clear guidelines will attract more and more institutional investments. Back in 2019, Association for Digital Asset Markets, or ADAM, a consortium blockchain of some cryptocurrency players published a paper called code of conduct.
Implementation of ADAM’s Code of Conduct- a Small but Significant Step
It mainly consisted of guidelines related to the eight tenets, namely : compliance and risk management, market ethics, conflicts of interest, transparency and fairness, market integrity, custody, information security and business continuity, and Anti-Money Laundering and Countering the Finance of Terrorism. Hence, the time has come when the sole authority of cryptocurrency regulation should take things a little bit further and fully implement the ADAM’s code of conduct. And after the continuous letters being sent to the SEC, it has become quite evident by now that the clarification over cryptocurrency regulation has become a requirement rather than a demand.
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With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
