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The hearings in the US Senate on crypto-loans gave optimism to the market

At yesterday’s hearing in the banking committee of the US Senate, Chairman of the Securities and Exchange Commission Jay Clayton and Chairman of the Commodity Futures Trading Commission Christopher Giancarlo told about the government’s plans to regulate the sphere of Crypto-currencies. Against the background of falling prices and bad news this week, the hearing was surprisingly optimistic.

Over the past 14 months there have been significant price fluctuations of bitcoin. Last year, the value of the Crypto Currency increased by 1300%, rising to the December maximum of $ 20,000. However, in 2018, on some exchanges, the price fell almost twice. Such volatility scared lawmakers and banks, some of which prohibited customers from using their credit cards to purchase digital currencies.

In a situation of uncertainty, Congress seeks to understand what place bitcoin can play in the current system of financial regulation and what further measures are needed to protect consumers.

Clayton was primarily concerned with the problem of ICO and talked about fraud in this area from the standpoint of legislation, while Giancarlo did not hide his enthusiasm about the prospects for a new Market.

On the question of the intrinsic value of the crypto currency, Giancarlo tried to explain how the process of mining bitcoin is carried out and how it is related to the price of the crypto currency. He also drew attention to the fact that between these phenomena the relationship is not always traced, referring to the observations of economists.

Clayton, in response to the same question, said:

“A lot of smart people argue that the crypto currency and exchange at the international level has some value. I do not see these advantages in the market yet. I look at this question from the position of small traders, and they should understand this. “

He also doubted that crypto currencies are suitable for use as currencies, once again reminding of the volatility of this market.

If the issue with the expansion of authority is resolved positively, this can lay the foundation for the creation of long-awaited crypto-exchange-traded funds (ETFs). Some American financiers have already attempted to obtain permission to create these new instruments, but so far unsuccessfully (European stock exchange index bonds, ETN) are available to European investors.

In at least one case, the Commission for Trade in Commodity Futures indicated the lack of a legislative base for refusing to register a crypto-exchange stock fund, so expanding the scope of existing legislation could lead to the flourishing of such financial instruments.

Most likely, Giancarlo and Clayton, on whom the current US administration is tasked with liberalizing regulation, will try to strike a balance between the expansion of the powers of their departments and the containment of inflating the bureaucracy.

The post The hearings in the US Senate on crypto-loans gave optimism to the market appeared first on 5 to 9 News.



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