Waters recommended the session with a view to seeing how best the industry can be overseen by the SEC. She made the call during a Tuesday hearing, when she asked director of the agency’s Strategic Hub for Innovation and Financial Technology (FinHub), Valerie Szczepanik about the possibility of such a session.
“I would like to try and organize small groups of Congress to be able to ask more questions and get more involved in what is really going on with some of these companies,” Waters said on Tuesday at a House Financial Services Committee panel focused on digital assets.
Waters is asking for this as some Republican lawmakers are proposing the proper regulation of cryptocurrencies in the U.S. Meanwhile, Waters believes the SEC is more than capable of handling crypto regulation since it announced that it was open to crypto companies registering with it.
Asking for the potential session, Waters enquired if the SEC could hold a “”special sessions with members of Congress to talk about the problems and the pitfalls that may occur and give some information that would help them not to believe that somehow they should be advancing or even advocating because maybe they just don’t know enough.”
Is Ether a Security?
One of the biggest problems with crypto regulation in the U.S is the lack of clarity over what is a security and what is a commodity. So far, SEC chair Gary Gensler insists that any cryptocurrency other than Bitcoin is a security.
During the Tuesday session, Majority Whip and pro crypto congressman Tom Emmer brought up Szczepanik’s previous review of the SEC’s former corporation finance director arguing that digital assets with “sufficiently decentralized” networks, such as Ethereum don’t fit under the umbrella of securities.
“When reviewing a draft you said that providing, quote, less detail in the speech was better because the concept of a token morphing from a security to a non-security was a new concept and would generate a lot of discussion,” Emmer said. “Do I have that correct?”
She admitted to the statement but wouldn’t confirm if Ether was a security or not, probably in order o not contradict Gensler’s position.
The Struggle for Regulation
Crypto came under intense pressure this year and still faces such pressure as the SEC resorted to regulation by enforcement. Since then however, theindustry, represented by companies like Coinbase have been pushing for clear regulation.
This led to Coinbase approaching and lobbying lawmakers, to which Waters said “these crypto companies are coming to Congress and to members of Congress, some members of Congress are truly interested in the role that crypto is going to play in the world and particularly in the United States.”
Indeed, lawmakers like Tom Emmer have played a critical role in supporting the industry, but a lot more needs to be done for the industry to be treated fairly. Meanwhile, there’s already a legislative framework in the process to become a law that will regulate crypto assets specifically.
Lawmakers like Waters don’t think this is necessary but the Commodities Futures Trading Commission (CFTC) thinks otherwise.