By Anjali Kochhar
Regarding the shortcomings in crypto oversight, Treasury Secretary Janet Yellen has been pressed by four US lawmakers. The lawmakers questioned Yellen about how the Financial Stability Oversight Council (FSOC), which she chairs, believes existing laws should apply to Bitcoin, ether, and non-security crypto assets. Yellen responded by explaining the council’s “repeated warnings about the lack of oversight of the digital asset markets.”
Lawmakers Wants Yellen to Provide Answers
Senators Patrick McHenry, Glenn Thompson, Dusty Johnson, and French Hill wrote to Treasury Secretary Janet Yellen regarding cryptocurrency regulation in the wake of her testimony before the House Committee on Financial Services. “Pass legislation to provide for the regulation of stablecoins and of the spot market for crypto-assets that are not securities,” Yellen asked Congress to do in her testimony.
McHenry leads the House Committee on Financial Services; Thompson oversees the House Committee on Agriculture; Hill heads the Subcommittee on Digital Assets, Financial Technology, and Inclusion; and Johnson presides over the Subcommittee on Commodity Markets, Digital Assets, and Rural Development.
According to Bitcoin.com, the letter outlines that following the collapse of crypto exchange FTX, the House Committees on Agriculture and Financial Services “initiated a groundbreaking endeavor to draft legislation aimed at enhancing regulatory oversight of the digital asset markets.” Specifically, the Financial Innovation and Technology Act for the 21st Century (FIT21) “aims to grant federal regulators definitive authority over the digital asset spot markets and guarantee that the customer safeguards present in the existing financial regulatory framework extend to intermediaries and activities related to digital assets.”
In addressing the regulatory authority of the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) regarding cryptocurrencies, the lawmakers informed Yellen:
It’s crucial to note the gaps concerning Bitcoin and ether, which have not been classified as securities. Since these underlying assets don’t fall under the securities category, neither the CFTC nor the SEC possesses the jurisdiction to register and oversee trading platforms or other intermediaries involved in spot transactions of these digital assets.
The lawmakers then posed several inquiries to the Treasury Secretary, seeking clarification on how FSOC (Financial Stability Oversight Council) promotes coordination and communication between the SEC and CFTC concerning federal oversight of the spot market for digital assets that do not fall under securities. The letter specifies a deadline for Yellen’s response, requesting it by Feb. 20.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.