America is a fantastic travel destination. We have so many financial regulators that we sometimes lack adequate financial rules. Cryptocurrencies are the most recent example.
Bitcoin and its contemporaries were far too common to be ignored, but that is exactly what happened. Public price, volume, and volatility data are not publicly available. There are no regulatory bodies in charge of crypto-exchanges. Nobody can be certain that investors are properly protected.
Even in the liberal world of cryptocurrencies, people are concerned about the federal government’s involvement. Mike Novogratz, the fund manager who helped lead the charge into the asset class, predicted that once the Road rules were finalised, the market would feel “relief,” and Congress suggested that Gary Gensler, the director of the Securities and Exchange Commission, be appointed.
Everything leads to one of a knid
“It’s going to be great if Gary finally gets to it,” Novogratz said of his fellow graduate Goldman Sachs. ” Every cryptocurrency is governed. He lacks the necessary authority.
Everything leads to a one-of-a-kind regulatory failure in the United States. Waiting for Gensler to reach all cryptocurrencies became Wall Street’s equivalent of Godot.
The underlying issue in the United States is the fragmentation of financial regulation. In addition to state regulatory systems, there are multiple federal banking and market authorities with overlapping jurisdictions. “There are no true authorities that can coordinate all moving parts and bridge differences,” JPMorgan Chase CEO Jamie Dimon stated in his annual letter to shareholders.
In the long run, this is a good thing. Checks and balances are as American as apple pie and junk bonds; having so many regulators is a miscalculation.
This system, however, has flaws. In the regulatory sense, new products that are not fish or poultry may become obsolete. Because encryption is difficult to define, it is difficult to control. Despite the fact that true believers refer to cryptocurrencies as currency, US regulators do not.
For a long time, Bitcoin, for example, was regarded as a commodity. Other cryptocurrencies are categorised as securities.
Congress is a legal entity in and of itself. Democratic Senator Elizabeth Warren asked Gensler in a letter this month if the SEC is “competent to close current regulatory gaps that vulnerably expose investors and consumers to dangers in this highly opaque and volatile market.”
Gensler’s response, which is scheduled for July 28th, is undeniably persuasive. However, whether it will compel lawmakers to act quickly is debatable. If history is any guide, the Congress will wait until it falls apart before deciding how to put it back together.