Senate Cryptocurrency Hearing: What happened?

Senate Cryptocurrency Hearing: What happened?

The Senate Banking Committee, Securities and Exchange Commission (SEC) Chairman Jay Clayton and Commodity Futures Trading Commission Chairman (CFTC) Christopher Giancario commented on the hot topic of cryptocurrency regulation.

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The Senate Banking Committee, Securities and Exchange Commission (SEC) Chairman Jay Clayton and Commodity Futures Trading Commission Chairman (CFTC) Christopher Giancario commented on the hot topic of cryptocurrency regulation.

During the open hearing Clayton presented his testimony  saying that the mission of SEC is to protect investors, while maintaining fair, orderly and efficient markets and capital formation. He expressed his optimism regarding the developments in financial technology, adding that these developments can enable the commission to better monitor transactions, holdings and obligations (including credit exposures). Yet, he expressed some concerns regarding the risks of ICO fraud.

On the other hand, the CFTC`s Giancario expressed a generally positive view of the emerging cryptocurrency market.

“Distributed ledgers – in various open system or private network applications – have the potential to enhance economic efficiency, mitigate centralized systemic risk, defend against fraudulent activity and improve data quality and governance .”, as he stated commenting on the potential benefits of cryptocurrencies and their underlying blockchain technology.

However, he emphasized that virtual currencies likely require more attentive regulatory oversight in key areas, specifically “to the extent that retail investors are attracted to the space”. Some of the appropriate Federal oversight activities could consist of data reporting, capital requirements, cyber security standards, measures to prevent fraud and price manipulation and anti-money laundering and “know your customer” protection, according to Giancario.

This hearing is setting a tone that may be described as generally positive, but concerned about consumers` rights and their protection against possible ICO frauds and unsafe exchanges. Nevertheless, those interested in the long-term viability of virtual currencies may find this as good news, as Tech Crunch wrote in a news report.

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