Coinbase is urging the US Congress to create clear rules for the crypto industry. They say the current lack of regulation is hurting innovation and investors.
Six Key Priorities for Crypto Regulation
Coinbase’s Chief Policy Officer, Faryar Shirzad, outlined six main things Congress should focus on:
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Clear Definitions: Congress needs to define what exactly counts as a digital asset – is it a security, a commodity, or something else? This will help everyone understand the rules.
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Commodity Futures Trading Commission (CFTC) Takes the Lead: Coinbase believes the CFTC should regulate cryptocurrencies like Bitcoin and Ethereum (which they see as commodities, not securities). This would bring more transparency and protect investors from scams.
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Securities and Exchange Commission (SEC) Focus on Fundraising: The SEC should create rules that make it easier for crypto projects to raise money legally, without every token being automatically considered a security.
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Stablecoin Framework: Rules are needed to ensure stablecoins (cryptocurrencies pegged to a stable asset like the US dollar) are trustworthy and fully backed.
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Protecting DeFi and Digital Commerce: The innovative world of decentralized finance (DeFi) and digital commerce (NFTs, etc.) should be allowed to grow without unnecessary restrictions.
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Regulation for Centralized Crypto Businesses: Companies that hold customer funds need clear rules to ensure they’re responsible and protect user money.
Why Clear Rules Matter
Shirzad argues that clear, simple rules will attract more people to the crypto economy, benefitting both businesses and consumers. He stressed the importance of integrating new crypto regulations into existing systems rather than creating entirely new, confusing ones. He also highlighted the need to balance protecting investors with allowing innovation to flourish. Creating overly strict rules could push crypto development overseas.
Coinbase’s Push for Regulatory Clarity
This push for clearer rules is part of Coinbase’s broader effort to work with US regulators. They recently asked for clarification on whether banks can work with crypto companies – something they believe is crucial for a healthy crypto ecosystem. They want everyone to be able to participate in the crypto economy.
