The Future of Crypto Regulation: Global Scope and Potential Impact
For investors, one issue as important as price is the scope of global crypto currency regulation and the limits it will create. As these will clearly affect the industry’s future, strict rules could lead to a significant collapse in price. There are two authorities to follow in terms of global regulation: one is the US and the other is EU regulations.
US Crypto Currency Law
For the establishment of global legal norms concerning crypto currencies, concrete steps must be taken by the US. The rules in the finance field are all emerging from the US and the EU. Therefore, more crucial than local regulations is the question of “which rules the world will follow” when it comes to crypto.
Particularly, steps to be taken in the fight against money laundering, exchange audits, KYC standards, stablecoins, and the DeFi sector will directly concern investors in all countries. This is because the limits and rules in the current banking system are determined according to global norms, established by US and EU regulators.
In preparation for the US crypto currency law, two bills have passed the committees of the House of Representatives. The process was prolonged due to in-house elections when it came to approval in the House of Representatives, and according to today’s news, the vote has been postponed to 2024.
When Will the Crypto Law Take Effect?
Republicans wanted to complete the voting this year and send the crypto currency bills to the Senate. We’ve discussed for months that US crypto legislation could get approval from the House of Representatives this year, and the president made promising statements about it.
The chairman of the Subcommittee on Digital Assets, Financial Services Committee of the House of Representatives, US Representative French Hill, mentioned that the vote for the two major bills is likely to shift to “the beginning of 2024.” What were these two bills?
- Stablecoin regulation
- Rules concerning the general crypto currency markets
Speaking at a Blockchain Association event, Hill and Senator Cynthia Lummis admitted that the leadership elections in the assembly prolonged the process and caused delay. Moreover, while some members who supported the bills have withdrawn their support, Gensler is firmly opposing them. The Democratic Party’s SEC Chairman Gensler has said many times that the current laws are sufficient for crypto. One of these bills gives the CFTC more authority while also facilitating the transformation of crypto currencies from securities to commodities.
The problem is that even if the Republicans pass the bills in the House of Representatives next year with their support, a more challenging process will begin in the Senate, where the Democrats are the majority. This also indicates that a definitive result may not be reached until the November 2024.