US Chamber of Commerce urges SEC, CFTC and CFPB to regulate ICOs

A new shift occurred in regulatory sentiment in the US, as the Chamber of Commerce, a representative of large corporation and SMEs offered suggestions to the SEC. The suggestions that were offered pertained to the regulation of Initial Coin Offerings [ICOs].

Moreover, as one of their “Eight FinTech Principles”, the chamber requested regulatory authorities to encourage novel capital raising methods: the kind that is represented in ICOs. However, they did mention that parties should advocate for “tailored oversight and strong consumer and investor protections” while doing so.

This comes after months of a lack of regulatory clarity pertaining to the cryptocurrency market. The call for clarity from the Chamber of Commerce holds a lot of weight, as they are effectively the world’s largest business organization. They also aim to “bridge the gap between technology and DC” through this report.

Calling out the lack of action on the United States Securities and Exchanges Commission’s part, they stated:

“We urge the SEC to give more guidance on the treatments of tokens and initial coin offerings (“ICOs”) to indicate whether a token is a security so companies can have more predictability and certainty in the marketplace.”

Moreover, they urged regulators to start issuing no-action letters. According to the SEC’s website:

“An individual or entity who is not certain whether a particular product, service, or action would constitute a violation of the federal securities law may request a “no-action” letter from the SEC staff.”

The Chamber requested the SEC to broadly consider and issue these letters. The same was requested of the Commodity Futures Trading Commission as well, with the report stating:

“For cryptocurrency that is a future, we urge the Commodity Futures Trading Commission (“CFTC”) to provide more guidance and broadly consider expedited no-action letters.”

No-action letters were requested from another regulatory party as well, namely the Consumer Financial Protection Bureau [CFPB]. The Consumer Financial Protection Bureau’s position is to regulate the offering and provision of consumer financial products or services. The report stated:

“The Bureau of Consumer Financial Protection (“Bureau”) should adopt a robust no-action letter and advisory opinion process that gives innovators the opportunity to receive regulatory certainty they need to be successful.”

The lack of a solid statement from the side of the SEC regarding the ICO market is a cause of frustration for many. Moreover, analysts state that the lack of a regulatory decision on the market has forced institutional investors from entering the market headfirst.

Elias Yami, a cryptocurrency enthusiast and analyst, stated:

“Due to pressure on institutional investors to stick to regulation, the cryptocurrency market does not see the attention it should. Going forward, I think greater regulatory clarity should bring in some of the big players. We’re already seeing the beginnings of a crypto-revolution on Wall Street, all we need is a spark to light the fuse.”

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