The lawsuit filed by the U.S. Securities and Exchange Commission (SEC) against Binance and Coinbase is based on “how the cryptocurrency industry is regulated and how the SEC and the Commodity Futures Trading Commission (CFTC) It underscores the need for the US Congress to come up with a “comprehensive framework on the relative responsibility of governments,” JPMorgan said in a June 8 research report.
The SEC believes that most cryptocurrencies should be classified as securities, which would place most cryptocurrency companies and their transactions under SEC oversight and the regulatory framework currently applicable to other securities. It will comply, the report says.
This is not a “simple lawsuit” and it is unclear which crypto assets will be classified as securities, wrote JPMorgan analysts led by Nikolaos Panigirtzoglou. The SEC v. Ripple lawsuit reflects this lack of legal clarity.
Last week, regulators announced that they would be suing Binance US, the operator of Binance US, and Binance’s founder and CEO Changpeng Zhao, aka CZ, for allegedly violating federal securities laws. A day later, it sued rival exchange Coinbase on similar charges.
These moves “make it more urgent for US lawmakers to come up with a comprehensive regulatory framework this year,” JP Morgan said.
Until that happens, crypto activity will continue to move outside the US and to decentralized entities, and crypto venture capital funding is likely to remain weak, he said.
If the SEC’s stance is approved by lawmakers, Coinbase, Binance.US and other U.S. exchanges will have to register as brokers and most crypto assets will be treated as securities, the report said. It is written.
And while this could be more “heavy and costly” for the industry, it would also mean that crypto markets would be well regulated, offering more transparency and investor protection, so some It adds that it will bring the positive side of
According to the bank, the SEC’s actions last week have created uncertainty about a number of Layer 1 tokens that have been classified as securities, making the situation favorable for Bitcoin (BTC) and Ethereum (ETH).
｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
｜Original: SEC Crypto Crackdown Adds Urgency for US Lawmakers to Produce Regulatory Framework This Year: JPMorgan