US Scarily Behind European Union on Crypto Licensing Laws — Gary Gansler Roasted

Key Takeaways:

• SEC launches the annual small business forum, which might not do much for crypto startups
• The agency fails to provide the guidance necessary in the crypto space.
• EU steps up, adopting crypto-friendly regulations, and Ukraine joins in, clarifying taxation laws.

YEREVAN (CoinChapter.com) – The US Securities and Exchange Commission (SEC) will launch its 42nd annual small business forum on April 24.

The event “provides the members of the public with feedback to improve capital raising policy for startups to smaller public companies and their investors.” Notably, the forum includes “an opportunity for participants to develop policy recommendations,” which rings hollow for crypto startups.

Gary Gensler Roasted Over Ethereum

In detail, the SEC falls behind its European counterparts in terms of crypto regulation despite several votes and meetings on the matter this year.

SEC Chairman Gary Gensler asserted that the Commission “voted to issue a supplemental release” to their January 2022 proposal, requiring “significant trading platforms to come under important rules for the markets” on April 14.”

Calling yourself a crypto platform is not an excuse to ignore securities laws. Calling yourself a DeFi platform is not an excuse to defy securities laws.

commented Gensler

Moreover, the Chair infamously failed to identify what Ether, the second-largest crypto, is. During the April 18 hearing with the House Financial Services Committee, Chair Patrick McHenry asked Gensler a simple question: Is ETH a commodity or a security? The SEC official failed to give a straight answer to the Mc Henry’s visible frustration.

The crypto community was also disappointed by the SEC’s lack of insight. Ryan Selkis, the founder of crypto analytical platform Messari, called the hearing an “absolute train wreck.”

Also read: Why is SEC Suing Coinbase (COIN) But Not Binance. 

“Schadenfreude is satisfying, but here’s the substance of how ineffective and out-of-touch the Biden admin’s financial regulators are right now. […] It is embarrassing to watch a sitting “leader” of a major financial regulator completely whiff on a simple question.”

Selkis tweeted.

EU Lawmakers Approve Crypto Licensing Law

While the US crypto regulators lack precision in their definitions of digital assets, the European colleagues took a step toward crypto regulation.

Financial watchdogs in the European Union voted 517-38 in favor of a new crypto licensing regime, Markets in Crypto-Assets (MiCA), making it the first major jurisdiction in the world to introduce a comprehensive crypto law.

The legislation, which seeks to reduce risks for consumers buying crypto assets, will mean providers can become liable if they lose investors’ crypto assets. Additionally, stablecoins such as Tether (USDT) and Circle (USDC) will be required to maintain “ample reserves” to meet possible mass withdrawals.

Stablecoins that become too large also face being limited to 200 million euros ($220 million) in transactions per day.

Experts predict a “massive boost” for crypto in the EU

Bradley Duke, the co-CEO of investment company ETC Group, told CoinChapter that he “applauds” the decision.

“It encourages growth, innovation, and job creation through the certainty and stability that sensible regulation brings. This also translates into far greater investor comfort knowing that their regulator is engaging with the asset class in a positive way and is implementing protections for their benefit.”

said the official.

Duke also noted the difference in the US regulators’ approach. He asserted that the regulatory law will be a “massive boost for the digital assets sector within Europe.”

“The SEC has taken an openly hostile stance against companies trying to operate legitimately within the space while simultaneously doing next to nothing to actually put in place a functional regulatory framework. The opportunity for Europe to now become the world’s digital assets hub is very clear.”

Duke further told CoinChapter.

Andrew Whitworth, EMEA policy director for blockchain firm Ripple, agreed, pointing out the SEC’s shortcomings in crypto regulation.

“Consistency in implementation around the EU will be key in providing crypto companies with the operational clarity to fuel innovation across Europe and guard against unwitting fragmentation of the Single Market.”

Whitworth said.

Also read: Jerome Powell Speaks Against Harsh Crypto Crackdown Before US Senate.