Best Bitcoin Exchange for the United States
Today, Tuesday, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) met to give an overview of the regulatory authorities’ dealings with crypto currencies before the US Senate. The topic was how a regulation of the crypto currency market can take place. The meeting was scheduled so that institutional investors would now also gain clarity. According to one analysis, the lack of a supervisory body is a reason for the caution of many investors. One of the most important problems on the crypto market are the grey areas, which cannot be covered by any regulations. The keynote speakers at the hearing were SEC Chairman Jay Clayton and CFTC Chairman J. Christopher Giancarlo. Both should clarify what supervisory role they should play in the future and what powers they should be given. Despite no criteria or regulatory plans planned in advance of the hearing, the outcome of the hearing so far has been positive. This was reflected in Clayton’s and Giancarlo’s statements. Although both institutions plan to become more involved in the control of the cryptographic market, they do not want to put a stop to the positive aspects of the technology or trading.
The CFTC speaks of great potential within blockchain technology. The financial industry in particular could benefit from this. One would like to apply a “Do no harm” strategy. This was also the right starting point for the development of the Internet. However, the condition was a more transparent supervision in key areas – the protection of small investors was emphasized. “It is important to remember that there would be no Distributed Ledger technology if the Bitcoin did not exist”. That was Giancarlo’s answer to Arkansas Senator Tom Cotton’s question about the value of the technology underlying crypto currencies like Bitcoin. In his comments, Giancarlo described them as inextricably linked. He emphasized the extremely “promising prospects” that the technology enables in a number of applications.
The SEC had put its focus on the situation at Initial Coin Offering (ICO). The starting position is quite inadequate. There are too many scams in this area that damage the current success of blockchain technology. SEC and the CFTC see it as their responsibility to create a regulated framework for market participants that enables innovation for companies as well as integrity and trust for investors.
The hearing, which lasted a good two hours, produced little news. The senators questioned were relatively harsh on the two listeners. In particular, questions arose about the intrinsic value of the Bitcoin and the strong volatility of more than double-digit percentages. In addition, questions were asked about the security of the systems, alluding to the hack of the Japanese trading platform CoinCheck. Clayton and Giancarlo defended the work of their institutions and their successfully implemented measures to prevent fraud (cited here are Coin Drop Markets, My Big Coin Pay Inc. and The Entrepreneurs Headquarters Limited). Giancarlo added, however, that the scope is limited, since the cryptographic markets are cross-border in nature.
In the course of the survey Giancarlo also stated that the possibilities of the CFTC are of course limited, as there are no national borders for crypto currency markets and they operate worldwide.
In summary, a positive picture was conveyed and also noted by the senators. The USA might be thereby pioneers for the world-wide developments of the Bitcoins and the crypto currencies, in particular also for Europe. The Americans see the benefit for innovations and investments more than the threat, this became clear.
USA, regulation and money laundering: new hub to ease SEC’s burden
On October 18, 2018, the U.S. Securities and Exchange Commission (SEC) announced the launch of the Strategic Hub for Innovation and Financial Technology (FinHub or FinTech for short) to resolve issues relating to the regulation of bit coin, block chain technology and other crypto currencies. The aim of the United States Securities and Exchange Commission is to outsource internal departments, thereby relieving the SEC and, with the help of the newly created branch office, to bundle the competences around the intended regulatory coordination of digital currencies.
The functions of the FinHub at a glance
With the help of the portal, companies, industry and public institutions have the opportunity to discuss technological developments and forward-looking ideas with SEC employees. In addition, the Securities and Exchange Commission provides information on its own initiatives and events and publishes publications via the FinTech server. An important part of the FinHub is the FinTech Forum, which focuses on digital investments and assets (crypto-assets) as well as transactions within the framework of distributed ledger technology. The platform is also intended to serve as a clearing house for SEC employees, making it easier to use FinTech’s expertise and exchange it with the Securities and Exchange Commission. In the application area, the portal acts as an interface to national and international supervisory and regulatory authorities in order to develop joint solutions to the new technological challenges and to implement effective supervision and control in one system.
More centralised Bitcoin regulation
SEC Chairman Jay Clayton introduced Valerie A. Szczepanik as Head of the new FinHub in the official press release. Commenting on the appointment, he said that the primary objective is to monitor innovation in the securities market and improve investor protection. To this end, supervisors need to be able to react more quickly and flexibly. It is the duty of the Securities and Exchange Commission to promote innovative approaches to capital formation, financial services and market structures in the interests of all stakeholders, including investors, but also to make them compatible.
With the help of the envisaged regulation, the typically decentralised crypto currencies are likely to lose some of their independence through stock exchange laws and regulatory systems.