Crypto has the potential to bring Democrats and Republicans together.
Faryar Shirzad, chief policy officer at crypto exchange Coinbase, told CoinDesk TV lawmakers are increasingly changing their perspective on crypto, but one thing is for certain: Crypto needs clear regulation.
“It may be the last bipartisan issue left in Washington,” Shirzad said during an appearance on CoinDesk TV’s “First Mover,” on Friday.
Shirzad, who once served as deputy advisor of the National Security Council for the George W. Bush administration, said there needs to be a clear consensus on which regulator should be responsible for overseeing the crypto industry.
Whether that oversight falls on the shoulders of the Commodities Futures of Trading Commission (CFTC) – as Shirzad prefers – or the Securities and Exchange Commission (SEC) has yet to be seen. Most recently, a bipartisan bill proposed by the U.S. Senate hinted at giving that responsibility to the CFTC, essentially giving the market regulator “exclusive jurisdiction,” and the ability to define what is and is not considered a “digital commodity.”
The CFTC oversees commodities futures, such as oil and metal, including financial currencies, and has taken on a prominent role in crypto. In part that’s because some exchanges, such as the CME, offer bitcoin (BTC) and ether (ETH) trading options. The SEC on the other hand, is responsible for overseeing the securities markets, including stocks and bonds, and more broadly aims to protect investors.
Shirzad said there is “little dispute about the importance of having regulation,” both from progressive and conservative lawmakers, but the issue of which U.S. agency should be charged with regulating the cash market, and having oversight over crypto exchanges, including Coinbase (COIN), is still up in the air. In the past, The SEC has cracked down on the exchange for allegedly marketing its tokens in a manner that would deem them as securities.
Still, Shirzad says it is apparent that “commodities should be regulated by the national commodities regulator, which is the CFTC.” What’s left is transparent regulatory standards.
“Some amount of regulation makes sense for the parts of the crypto economy that need regulation,” Shirzad said. “The thing that members of Congress are most focused on is regulating crypto intermediaries.” Crypto intermediaries, like Coinbase, that take in the public’s money and work as the middleman to delegate market activity, fall under that purview.
“If any particular regulator thinks any particular token is one thing, the degree to which we can have clarity on that allows us to operate under clearer guidelines and allows us to do what we need to do,” Shirzad said.
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