It was a historic day in the world of cryptocurrencies, as the US Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) met in front of the The Senate Committee on Banking, Housing and Urban Affairs to discuss their “oversight role” on what they called “virtual currencies.”
What many expected to be an event that would establish the U.S. government’s stranglehold position on how they would begin regulating this new asset class for the future…
Was actually much less scary than what most projected, and the overall crypto market has responded significantly in favor of the outcome, as we are back in the green.
During our Insider’s Circle weekly coaching call last night with one of our expert cryptocurrency coaches, we briefly covered what was discussed during this committee hearing, as well as the implications for the overall crypto market going forward.
Let’s take a quick look at the five main points…
- Blockchain technology is here to stay: even the government is smart enough to realize that blockchain technology, or the most popular form of “distributed ledger technology,” will help improve process efficiencies, cut costs, and save time. Expect to see more projects funded by the government using this technology, but don’t expect them to utilize decentralized cryptocurrencies.
- Cryptocurrencies are a commercial byproduct of blockchain: SEC Chairman, Jay Clayton, sees cryptocurrencies as a way that people are monetizing the underlying blockchain technology, and that most of these “virtual currencies” have failed to live up to their promise of making “it easier and cheaper to buy and sell goods, particularly across borders” and “that transaction fees and costs will be eliminated or reduced.”
- ICO’s that look like a security, talk like a security, and are sold like a security… are a security: this seemed to be Mr. Clayton’s biggest concern of the entire crypto market, is that many of these ICO’s, or Initial Coin Offerings, are being portrayed as something other than a security, when they are truly a security, but just in disguise. Expect the SEC to crack down harder on ICO’s offered to U.S. investors.
- CFTC Chairman J. Christopher Giancarlo is now beloved by the crypto community: for someone who’s kids weren’t interested in stocks, but can’t stop talking about cryptocurrencies, this guy actually has an open mind about the future of digital currencies because it actually hits home for him. He not only knows what the term “HODL” means, and doesn’t mind explaining it to the committee, but understands that “We owe it to this new generation, to respect their interest in this new technology with a thoughtful regulatory approach.” We need someone like this in our corner if we are to work together and shape the future of crypto that we all need and want so badly.
- Crypto has officially moved out of the darkness and into the light: something extremely interesting happened yesterday… for once, there was no mention of buying drugs and participating in illegal black market activities with cryptocurrencies. In the past, this was all the government wanted to highlight. And although, they still see this as a form of fundraising for terrorist organizations, the overall sentiment for consumer use-cases has changed. They now recognize the commercial appeal of this industry. This is HUGE for crypto going forward.
Overall, we believe that this meeting was a great start to a much needed step in the future of crypto, especially if large institutional investors are going to get into the game.
For them to even have any interest, there will need to be some form of regulation, and while we should be self-regulating ourselves to an extent, this market will never achieve it’s true potential of being TRILLIONS of dollars in value if there is not some sort of government oversight in how it operates.
If you’d like to catch the whole committee hearing, you can check it out HERE.
To your success,
“Crypto” Colin Andrews and The LearnCryptoFast Team