Lawmakers See the Lummis & Gillibrand Bill Sidelined until 2023
In June, FX Empire reported on the Lummis and Gillibrand Bill, which aims to give regulatory powers to the CFTC.
Since then, the G7, the White House, the US Treasury, and others have attempted to progress towards a global regulatory framework.
However, the progress is slow, highlighted by the lack of lawmaker enthusiasm to debate the Lummis and Gillibrand Bill.
On July 19, in a joint pre-recorded interview with Gillibrand, Senator Cynthia Lummis told Bloomberg,
“It’s a big topic, it’s comprehensive, and it’s still new to many US senators.”
“The wide-ranging scope of the legislation may make it difficult for lawmakers to digest quickly.”
The bipartisan bill that has found the support of the crypto industry could deliver the ideal mix of innovation and consumer protection.
While well-versed lawmakers recognize the need for innovation and regulation, crypto market sentiment towards the SEC and the CFTC is in favor of the CFTC.
The SEC and the CFTC Need Lawmakers to Decide
In June, FX Empire considered the likely battle between the CFTC and the SEC to win control of the digital asset space.
While the Lummis and Gillibrand Bill aims to pass the baton to the CFTC, the SEC remains in the hunt. The ongoing SEC v Ripple case is a focal point for investors and lawmakers.
The pushback of the Lummis & Gillibrand Bill to 2023 could even coincide with the outcome of the SEC case against Ripple.
However, lawmakers have highlighted one problem, the SEC’s targeting of crypto firms. The SEC has dished out some punitive fines that may have led crypto shops to other jurisdictions. Earlier this year, lawmakers approached Gensler, questioning the SEC tactics to which the SEC Chair may have responded.
SEC Chair Gensler softened his position, calling on the CFTC for collaboration to regulate the digital asset space. Following the call for a partnership, Gensler even talked of easing SEC regulations on crypto firms.
A shift in stance may prove positive for the crypto space. It will ultimately boil down to the answer to the puzzle. What is and isn’t a security?
Regulatory Uncertainty Doesn’t Breed Crypto Innovation
Uncertainty is bad for any asset class and no different for the crypto space. Since late December 2021, the talk of increased regulatory oversight adversely affected investor sentiment.
Since calls for a global regulatory framework, the landscape has changed. However, the need for a regulatory framework remains. Once market conditions improve, crypto-related firms and investors will look for legislation that supports innovation and protects consumers.
Finding the balance is crucial to cryptos and the global financial markets.