Cryptocurrency and terms related to it need to be properly defined, says US Congressman

In a recent interview with CNBC, Congressman Warren Davidson, a member of the financial services committee in the United States spoke about the cryptocurrency regulations that are being processed in the country’s portals.

Davidson stated that the field of cryptocurrency is much bigger than Bitcoin and that regulations are a tricky affair. The government official touched upon how the tokens are approaching the form of mainstream currency with a lot of industry leaders contributing their own ideas to make fintech bigger and better.

He added that the officials want to do good things with the product but the sheer amount of uncertainty around it makes it complicated. According to him, concepts such as cryptocurrency trade futures are fast catching on, with the only pull back being the lack of credibility.

The Congressman also revealed how the Securities and Exchange Commission [SEC] is wrestling with concepts such as the passing of the Bitcoin ETFs. Congressman Davidson’s main point of focus was the confusion between security tokens and tradeable tokens that act as a factor in the overall industry uncertainty. He stated:

“A lot of people, as well as officials, are still grappling with the core details of the cryptocurrency industry. The term “security tokens” creates a sense of confusion that is very hard to disperse. Imagine if Apple launched the iCloud and each TB of storage was equal to token. Would users buy it? I don’t think so.”

The financial services official also spoke about the prevalent issue of custody, a concept that has been pitched by a lot of cryptocurrency evangelists. The main concern raised by him was the fact that cryptocurrency at the point of entry is anonymous. Since the digital assets are based on a public ledger, the rest of its processes are trackable, stated Warren Davidson.

Just recently, reports talked about BitGO, a cryptocurrency company planning to devise ways to fill the gap in institutional investors. Mike Belshe, The CEO and Co-Founder of BitGo had said:

“This is the missing piece for infrastructure — it’s a treacherous environment today. Hedge funds need it, family offices need it, they can’t participate in digital currency until they have a place to store it that’s regulated.”

The Congressman was candid while saying that he too would like to hold cryptocurrencies feels he ‘has missed out on a lot’. He also went on to say that the terms circulating in the cryptocurrency industry are sloppy and that asset classes, tokens, and securities need to be properly defined.

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