Economist Jonathan Rose said, “The research proposes the adoption of legislation granting regulatory power to federal financial regulators over this sector.” The Financial Stability Oversight Council, or FSOC, has proposed that U.S. legislators enact legislation to decide which “rulemaking body” would be responsible for regulating portions of the cryptocurrency spot market.
While some enterprises in the crypto asset ecosystem have sought to escape regulation, others have participated in the current regulatory structure by acquiring trust charters or state-level crypto asset-specific charters or licenses, according to Rose. “The research urges the adoption of legislation to provide federal financial regulators with regulatory power over this [spot] market.”
According to Rose, cryptocurrencies might pose a problem to the U.S. economy’s financial stability “under certain scenarios,” including expansion without appropriate regulatory controls. In the view of authorities, crypto businesses operating via affiliates or subsidiaries seem to hide their offers.
He also questioned whether corporations should be permitted to sell services through intermediaries, such as “broker-dealers and futures commission merchants.” Janet Yellen, Treasury Secretary, said in a statement prepared for the council meeting:
“These papers provide policymakers with a solid platform for mitigating the risks of digital assets while achieving their potential advantages. In addition, they contribute to the public’s comprehension of digital assets.”
Many in the industry have also attacked the two organizations for their “regulation by enforcement” approach to digital assets, which seems to be an effort to establish regulatory authority over the market without going through Congress.