Stronger crypto regulations in US won’t necessarily help prevent fraud, says Okcoin CCO

consultation conference male lawyers professional businesswoman working discussion having law firm office concepts law judge gavel with scales justice scaled

Megan Monroe said an “incubator” approach might be one possible solution to the current “patchwork of financial regulations” in the United States.

Though Okcoin chief compliance officer Megan Monroe said that there are still certain grey areas over cryptocurrencies in the United States, further regulation may not be the best solution.

In a statement to Cointelegraph, Monroe said current U.S. regulations are sufficient to police cryptocurrency exchanges, token issuers and custody wallet providers, but “jurisdictional boundaries of these federal financial regulators are neither clear nor collaborative.” Rather, she advocated for a framework with greater clarity to determine which crypto firms should be subject to regulation and let investors know which protections are available.

“A clear regulatory framework with established jurisdictional boundaries, flexible compliance standards and open communication channels with registrants (as well as with state regulators) would be a good way to initiate an evolving framework for market participants to grow their businesses,” said the Okcoin chief compliance officer. “[This] would provide retail customers that seek to work with regulated entities a clearer understanding of the investor protections that would be available to them.”

She added:

“We do not believe that further regulation will necessarily prevent fraud and platform abuse […] Fraud should not be limited to focusing on retail customer regulatory compliance issues in the securities markets.”

Two of the major government agencies handling digital asset regulation in the United States, the Securities and Exchange Commission, or SEC, and the Commodity Futures Trading Commission, or CFTC, have different jurisdictional claims regarding crypto.

The SEC often determines whether tokens are securities using the Howey Test, with Chairperson Gary Gensler arguing the crypto industry, including decentralized exchanges, falls within the regulatory purview of the federal agency. However, former CFTC Chair Christopher Giancarlo has claimed that cryptocurrencies are commodities and thus would be subject to regulation by the CFTC.

The apparent lack of clarity can be seemingly confusing to crypto firms that are considering relocating to the U.S., or local ones making the transition to the digital space. David Schwartz, chief technology officer of Ripple Labs, told Cointelegraph earlier this year that it was “difficult to figure out which laws apply and how they apply to something new,” like cryptocurrencies or blockchain technology.

“Over time, the regulators have educated themselves about the industry and expanded their scope to incorporate new blockchain technology, such as decentralized exchanges and DApps,” said Monroe. “But, the regulations still lag behind the industry innovation, which is why the regulators have yet to provide comprehensive regulatory guidance on decentralized finance technology.”

The Okcoin chief compliance officer said that an “incubator” approach might be one possible solution to this “patchwork of financial regulations,” wherein crypto traders and businesses could operate without fear of legal action for a set period of time. She also encouraged projects to clearly identify the risks to both investors and users, and for greater communication and collaboration between agencies like the CFTC, SEC and Financial Crimes Enforcement Network.

Ronnie Huss

Ronnie Huss

Leave a Reply

Your email address will not be published. Required fields are marked *

Share:

Share on telegram
Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp

Related Posts

bitcoin
Bitcoin (BTC) $ 67,204.01
ethereum
Ethereum (ETH) $ 3,749.50
tether
Tether (USDT) $ 0.999365
bnb
BNB (BNB) $ 593.96
solana
Solana (SOL) $ 168.84
staked-ether
Lido Staked Ether (STETH) $ 3,747.35
usd-coin
USDC (USDC) $ 1.00
xrp
XRP (XRP) $ 0.522729
dogecoin
Dogecoin (DOGE) $ 0.165213
shiba-inu
Shiba Inu (SHIB) $ 0.000028
cardano
Cardano (ADA) $ 0.451456
the-open-network
Toncoin (TON) $ 6.45
avalanche-2
Avalanche (AVAX) $ 36.34
chainlink
Chainlink (LINK) $ 18.56
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 67,237.01
polkadot
Polkadot (DOT) $ 7.17
tron
TRON (TRX) $ 0.112044
bitcoin-cash
Bitcoin Cash (BCH) $ 466.65
near
NEAR Protocol (NEAR) $ 7.63
uniswap
Uniswap (UNI) $ 10.49
matic-network
Polygon (MATIC) $ 0.716433
litecoin
Litecoin (LTC) $ 83.64
pepe
Pepe (PEPE) $ 0.000015
internet-computer
Internet Computer (ICP) $ 12.12
fetch-ai
Fetch.ai (FET) $ 2.20
leo-token
LEO Token (LEO) $ 5.95
dai
Dai (DAI) $ 0.999194
wrapped-eeth
Wrapped eETH (WEETH) $ 3,897.03
ethereum-classic
Ethereum Classic (ETC) $ 30.38
render-token
Render (RNDR) $ 10.31
aptos
Aptos (APT) $ 9.09
dogwifcoin
dogwifhat (WIF) $ 3.81
renzo-restaked-eth
Renzo Restaked ETH (EZETH) $ 3,710.98
hedera-hashgraph
Hedera (HBAR) $ 0.103136
cosmos
Cosmos Hub (ATOM) $ 8.68
arbitrum
Arbitrum (ARB) $ 1.15
immutable-x
Immutable (IMX) $ 2.22
mantle
Mantle (MNT) $ 0.995060
kaspa
Kaspa (KAS) $ 0.136897
filecoin
Filecoin (FIL) $ 5.81
crypto-com-chain
Cronos (CRO) $ 0.117007
stellar
Stellar (XLM) $ 0.106862
first-digital-usd
First Digital USD (FDUSD) $ 0.998403
the-graph
The Graph (GRT) $ 0.310259
ethena-usde
Ethena USDe (USDE) $ 1.00
blockstack
Stacks (STX) $ 1.93
okb
OKB (OKB) $ 45.83
optimism
Optimism (OP) $ 2.52
bittensor
Bittensor (TAO) $ 396.44
floki
FLOKI (FLOKI) $ 0.000269