Regulators in the United States are preparing to launch collaborative efforts to step up their scrutiny of cryptocurrency markets, according to comments made in an article written jointly by the head of two separate agencies.
The chief of the Securities and Exchange Commission and his counterpart at the Commodity and Futures Trading Commission penned the contribution in the Wall Street Journal, committing their respective organisations to doing more to regulate the cryptocurrency space.
According to the article, both organisations are already devoting increasing resources to projects targeting cryptocurrency markets, while reiterating their commitment to eradicating fraudulent behaviour.
The comments, written by J. Christopher Giancarlo and Jay Clacton, is the latest in a series of pronouncements on the future of cryptocurrency regulation from the agencies, and comes amidst growing calls for stricter regulation.
“The SEC is devoting a significant portion of its resources to the ICO market … Market participants, including lawyers, trading venues and financial services firms, should be aware that we are disturbed by many examples of form being elevated over substance, with form-based arguments depriving investors of mandatory protections,” the officials said.
Furthermore, the duo highlighted that cryptocurrencies were primarily “promoted, pursued and traded as investment assets”, with underlying utility a “distant secondary characteristic” – a factor instrumental in the Securities and Exchange Commission’s earlier comments and enforcement action around ICOs.
In recent weeks, the CFTC has been involved in preliminary legal action against the promoters of several cryptocurrency investment schemes over alleged fraud, underlining the increasingly more hands-on approach of regulators in the country.
Their article concluded in support of the need for an overhaul of existing regulations, confirming the direction of travel favoured by the regulators.
“Many of the internet-based cryptocurrency-trading platforms have registered as payment services and are not subject to direct oversight by the SEC or the CFTC. We would support policy efforts to revisit these frameworks and ensure they are effective and efficient for the digital era,” the duo stated.
If the editorial is an indication of future plans, it could suggest efforts to regulate and control cryptocurrency markets in the U.S. are likely to intensify further in the coming months.