18.10.2021

The SEC has no desire to ban Bitcoin. But Congress can do it

The head of the US Securities and Exchange Commission (SEC) Gary Gensler said that the financial regulator has no intentions and powers to completely ban cryptocurrencies. However, this does not mean that the crypt cannot be banned in the country.

Answering questions during the hearings of the House of Representatives Committee on Financial Services on Tuesday, Gensler stressed that the total restrictions on digital assets are not within the purview of the SEC.

At the same time, “the consideration of this issue should be dealt with by the Congress . Let’s talk about the situation in more detail.

Will Bitcoin be banned in the US?

During his speech to Congressmen, Gensler noted that regulation of the cryptosphere remains an important item on the agenda of the financial regulator. Here is his line, in which he shares his attitude to what is happening. The quote is from Cointelegraph .

It’s about how exactly we will enter this area within the framework of consumer and investor protection that we have. Also, how will we work with banking regulators and other institutions in the context of combating money laundering as well as tax compliance.

According to the head of the SEC, “many of the tokens” in the cryptosphere do indeed have the features of investment contracts, which means they must be regulated in accordance with the relevant laws. Also, stablecoins issued by private companies attract significant attention of the Commission, as they “can pose a threat to financial stability.”

Congressional spokesman Patrick McHenry during the hearing noted the position taken by the SEC on digital assets led by Gensler, accusing the head of the regulator of failing to act in accordance with the agency’s long-standing practice of noting comments on rulemaking and legal procedures.

Some of the comments you made raised questions in the marketplace and made things less than clear. You made seemingly unexpected remarks that affected the assets, you ignored the rule-making by issuing a statement without due process of law, and you were, in fact, rude to American investors.

Congressman Patrick McHenry

Gensler’s harsh comments about crypto in the past seem to have sparked concerns in Congress. McHenry also referred to the inconsistency of the current position of the head of the SEC regarding the quotes that he voiced back in 2019 during his teaching at the Massachusetts Institute of Technology. Recall that then Gensler called Bitcoin and Ethereum goods, not securities.

Now the chairman of the US Securities and Exchange Commission has a clearer position in relation to the crypt.

I’m not going to go into the details of any one token, but I think the securities laws are clear enough. If you are raising money and investors have a reasonable expectation of profit based on the efforts of others, this is in line with the rules of the securities law.

As you can see, so far the SEC is in no hurry to occupy an active opposition to the crypto market, trying to introduce any strict bans. It is unlikely that the United States will ban Bitcoin with the same strictness as it was done in China . But Gensler does not rule out that Congress may take active measures against BTC if the US government considers the rapid development of the crypto industry a direct threat to its own financial stability.

And while Bitcoin is viewed with a great deal of skepticism in America, Brazil’s financial regulators have taken a more liberal stance. According to Decrypt , the country is working on a legal infrastructure that could make it easier for investors to invest in the main cryptocurrency. The Brazilian legislature recently approved a draft bill that aims to regulate digital currencies.

The bill was originally introduced by a member of Expedito Netto. But now deputy Aureo Ribeiro of the Solidariedade party has proposed an updated project that seeks to legalize Bitcoin as a “payment currency” in the country.

Brazilian MP Aureo Ribeiro

At the moment, cryptocurrency is not a legal tender in Brazil, but the Ribeiro bill will also not make it an alternative to the national currency. Rather, BTC can become a “payment currency” here, although there is no exact explanation for this term yet. Here is Ribeiro’s quote on this matter.

We want to separate the wheat from the chaff, create rules so you can transact, know where you buy, who you are trading with, and have that asset to buy a house, a car, or go to McDonald’s to buy a hamburger.

The MP hinted that soon the status of Bitcoin in the country will be comparable to the status of the cryptocurrency in El Salvador. Recall that in early September, the government of El Salvador adopted BTC as a legal means of payment, and more recently, cryptocurrency users in the country even began to receive various bonuses .

With the inclusion of Brazil in the crypto race, digital assets may become a major trend in the Latin America region, which will give an additional impetus to the adoption of Bitcoin around the world.

We believe that even in the worst-case scenario, only local investors will suffer from the actions of US regulators. At the same time, cryptocurrencies will continue to exist further, because, due to their decentralized nature, they do not need to depend on someone. Accordingly, the development of digital assets will be.

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