- The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have approved the proposal to force private hedge funds to report cryptocurrency exposures.
- Although regulators have been focused on cryptocurrencies for a long time, the disappearance of Terra set off alarms around the world.
In the midst of a bearish cycle, despite the latest green candles that Bitcoin has shown, The United States seems determined to attack cryptocurrencies. It first hit Tornado Cash, a tool used to make public funds transfers private, and now there are rumors it would go after hedge funds that work with BTC.
As announced CoinDeskthe two main regulators in the US market, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), voted and approved the proposal to force private hedge funds “report cryptocurrency exposures on something called an FAQ Form that is filed confidentially with regulators”.
Now the “public” will have 60 days to analyze the proposal. Once again, the US authorities have emphasized that these requirements are due to the fact that cryptocurrencies are used for illegal businesses, such as money laundering or financing for terrorist entities.
SEC Chairman Gary Gensler stated that he supports this proposal because if adopted it will improve the quality of information his institution receives from all Form PF filers, with a particular focus on large hedge fund advisors.
“This will help protect investors and maintain fair, orderly and efficient markets.s,” said the chairman of the SEC.
The SEC and CFTC behind hedge funds
The SEC and CFTC have been after private hedge funds for quite some time, those that at the moment have fewer obligations than traditional investment funds, although they have grown a lot in recent times. The desire remains always the same: to control as much as possible.
The eyes of regulators have been on cryptocurrencies forever, but the bear market set off alarm bells: the disappearance of land, a billion-dollar behemoth, not only put digital assets in check. The fear that something similar will happen again with greater or equal impact is a concern of the US authorities and the whole world.
Officials against the proposal
Although the Securities Market Commission and the Commodity Futures Trading Commission achieved a majority to require private funds to provide more information than they currently do, High-ranking officials are not so in agreement with what was voted. They consider that it may be “excessive”. It is worth noting that cryptocurrencies were not the only topic discussed and approved.
SEC Commissioner Hester Peirce, dubbed the “mother of cryptocurrencies,” was one of the voices speaking out against it. So does CFTC Commissioner Summer K. Mersinger.
“The data and information that federal regulators request from market participants must be closely tailored to the intended purpose in our governing statutes, and unfortunately, that does not appear to be the general focus of this proposal,” he said.
The US authorities are determined to stifle cryptocurrencies and these measures only reinforce their position. Requiring so much control could end up with an effect contrary to the one proposed.
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