As the cryptocurrency fever envelops the world, U.S. lawmakers are starting to consider and develop new legislation and regulations which will impose stricter federal oversight on bitcoin as well as other currencies from the same class.
According to Reuters, a bipartisan momentum is growing in the Senate and House of Representatives for action to address the risks posed by virtual currencies to investors and the financial system. Even those that are wary of government red tape, like free-market Republican conservatives, said that regulation will be much needed if cryptocurrencies start to threaten the U.S. economy.
“There’s no question about the fact that there is a need for a regulatory framework,” said Republican Senator Mike Rounds, a Senate Banking Committee member.
Reuters reports that the digital assets currently fall into a jurisdictional gray area between the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Treasury Department, the Federal Reserve and individual states.
However, the main concern on Capitol Hill is focused on speculative trading and investing in cryptocurrencies, which made several lawmakers start pushing for digital assets to be regulated as securities and be subject to the SEC’s investor protection rules.
“The SEC is properly the lead on the issue,” said Republican Representative Bill Huizenga, chairman of the House Financial Services Subcommittee on Capital Markets which will start holding hearings on the developing issue in several weeks time. Huizenga said to Reuters reporters that the recent growth of the virtual currency market had made him more comfortable with more oversight.
“Six months ago, we didn’t see this explosion. The marketplace has changed,” he said.
Another lawmaker advocating for direct oversight of digital assets by the SEC is the Democratic senior member of the House Financial Services Committee Carolyn Maloney.
”A lot of people don’t realize there’s nothing backing these virtual currencies,” Maloney said trying to set herself as leader of the crusade for controlling cryptocurrencies.
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