A coalition of industry watchdogs in the United States has come together to express their opposition to a draft bill on the crypto market structure proposed by the United States House Financial Services Committee. In a detailed correspondence addressed to the committee, groups such as Americans for Financial Reform and the Center for Responsible Lending argued that the crypto industry had actively lobbied in favor of the draft proposal but had failed to demonstrate any practical use cases beyond speculative investment.
The watchdogs accused the crypto market of seeking favorable legislation under the guise of innovation, specifically highlighting their concerns about a provision in the proposed bill that would alter the evaluation of regulatory rulemaking by the U.S. Securities and Exchange Commission (SEC) based on the criterion of “innovation.”
The draft bill was intended to establish a regulatory framework in the United States with clear rules and guidelines for the crypto industry. Committee chair Representative Patrick McHenry had planned to hold a committee vote on the bill in July 2023. The involvement of the SEC in overseeing the regulatory framework was a key focus of the proposal.
In June 2023, the SEC took legal action against two prominent crypto exchanges, Coinbase and Binance, known for their substantial trading volumes. However, the market response to the news was relatively muted, with minimal impact on crypto prices.
In contrast to the demands for stricter regulations, the watchdogs argued that Congress should support the ongoing enforcement actions of the SEC as a means to protect consumers. Meanwhile, other jurisdictions in Europe and Asia are actively working to attract crypto businesses that may be relocating away from the United States.
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