The CEO of Bitfury and former comptroller of the currency, Brian Brooks, has hinted that the US regulatory environment could push many cryptocurrency companies out of the country, And it has already hampered companies trying to offer a variety of financial products.
At a hearing on Wednesday on the digital assets and the future of finance with the House Financial Services Committee, Congressman Ted Budd said he feared that the current policy of regulation by law enforcement in the United States could “force the next generation of fintech to be created outside of our country.” Speaking on behalf of Bitfury, Brooks said:
“There are some products that are legal in other countries and they just aren’t here,” Brooks said. “One of the things that makes cryptocurrencies risky is that consumers may not understand the difference between one token and another, so they may want to diversify […] We don’t allow that in the United States – we do allow it in Canada, we allow it in Germany, Singapore, Portugal, and a number of other places. “ And he added:
“If you are a promoter of [fondos cotizados], there is no fuzzy line, it’s super clear: you can’t do it here, so you have to go abroad. “
Brooks blamed the lack of exchange-traded funds, or ETFs, in the United States on the Securities and Exchange Commission. Although the regulator has recently approved ETFs with exposure to Bitcoin (BTC) futures from investment managers ProShares and Valkyrie, it has not yet given the green light to “pure” ETFs for BTC or other cryptocurrencies. Instead, many US companies with operations in Canada have successfully applied to local regulators for ETFs with direct exposure to cryptocurrencies.
However, the former head of the OCC suggested that the lack of approval of cryptocurrency investment products was rather the result of the United States’ “fragmented approach to regulation”, given the number of bodies that oversee banks, finance and now digital assets. Brooks proposed a solution in which traditional financial institutions were treated very similarly to cryptocurrencies.
“When I hear people talking about the idea that we need a regulator for cryptocurrencies, I would say that we should have a regulator for banks first, but we have three.” Brooks said. “The last thing we need is to add another regulator to a system that already has dozens of regulators.”
“If I am a crypto lending platform, it should probably be FDIC regulated. If I am a cryptocurrency trading platform, it probably should be CFTC and SEC regulated, but somehow we treat cryptocurrencies, because they are new, like something different from everything else. I’m going to argue that cryptocurrencies are just an enhancement of the system’s function. “
The CEOs of Circle, FTX, Bitfury, Paxos, Stellar Development Foundation, and Coinbase Inc. are currently responding to questions from US lawmakers about the state of digital assets in the country. Cointelegraph previously reported Wednesday that House representatives have raised concerns about token projects that exercise centralized control over the assets of many users.
Keep reading: