CEOs of several companies recently appeared before Congress. The main requirement of companies is to demand better and clear regulations for cryptocurrencies.
Companies in the bitcoin (BTC) and cryptocurrencies environment based in the United States of America continue the fight to achieve an optimal regulatory ecosystem to operate. In this case, some of the most relevant companies in the sector managed to invest at least USD 5 million in lobbying to pressure, in a certain way, the creation of a regulatory framework.
In a report revealed this December 10 by The Economist on the recent political movements that crypto-asset companies have been exercising, companies such as Coinbase and Block have targeted funds to political campaigns and boost initiatives in the United States Congress.
This information gets closely related to what happened on December 8. That day, CEOs of six companies in the Bitcoin industry revealed before Congress their demands for a clear regulatory framework in the field of cryptocurrencies.
On the other hand, the United States of America does not have a developed legal framework for cryptocurrencies. Many crypto-asset products have been approved already, including the first bitcoin futures exchange-traded funds. However, there is still no legal framework that could change the current laws that rule the system.
This road ahead pushed companies to increase their investment and start moving influence. The Economist reported that the money used for lobbying quadrupled in size compared to the fourth quarter of 2020.
According to Regulators, America is not China
One of the possible fears of companies is that the United States of America could go the way of China and veto Bitcoin from the country. Early in October of this year, the president of the SEC, the entity in charge of regulating the trade of financial products, clarified that the country would not prohibit the use of bitcoin and other crypto-assets.
While this is the position of the SEC chairman, the lack of a firm regulatory framework has led companies to travel through a path full of uncertainties.
Months ago, Coinbase received lawsuit threats from the SEC, following the launch of “Lend,” a cryptocurrency credit service. The first reason was that the product qualified as a security, and the company needs an enabling license to offer it.
For his part, Coinbase CEO Brian Armstrong stated via Twitter that before launching Lend, they previously told the SEC about the product through a briefing. The answer they got from the agency is that the loan function was a guarantee.
Armstrong said a loan being a guarantee seemed strange. In that regard, he asked the SEC to help them understand and share his point of view. These examples show a “push and pull” between companies and regulators.
By: Jenson Nuñez
