Regulatory approval for cryptocurrencies and blockchain technology in the United States is still a long way from being provided. While there has been some progress made on the front this year alone, it’s no news that a section of Capitol Hill (and Washington in general) is still opposed to the prospect of allowing crypto assets to become legalized in the country.
However, one lawmaker is voicing his opinion concerning the need for a positive attitude towards the American crypto space. On October 22, Rep. Patrick McHenry, a Republican Representative from the 10th District of North Carolina, appeared on an episode of the Unchained Podcast, where he urged regulators in the country to approach a positive approach to cryptocurrency innovation.
Time for a pro-innovation approach to crypto
In the podcast, McHenry, who has been nicknamed “Mr. FinTech” by his Capitol Hill compatriots due to his affinity for technological inclusion in the finance space, claimed that the value of Bitcoin has become too apparent to ignore. Speaking on his own observations of the crypto space, he claimed that there is currently a wealth of new ideas, and the current level of response from regulators will only lead to them getting outpaced by the industry.
As he sees it, it would be much better for regulators to become more familiar with cryptocurrency innovations, and do so quickly.
He further argued that the evolution of the industry had led us to a new phase; one where the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) are now saddled with the challenge of getting smarter, and where both the U.S. Treasury and IRS will need to adopt proactive taxation policies to cover cryptocurrencies as well.
America’s very own regulatory sandbox
Hoping to fill this void, McHenry has reintroduced the Financial Services Innovation Act, a bill that advocates for the creation of financial service innovation offices in all federal offices which have financial services as part of their jurisdiction.
As he sees it, the bill will help ensure that regulators are “innovation-forward and situated to say yes rather than no. I want the default to be yes, not no.” He argued that these offices would help establish guidelines for beta testing, which will go on to be mandatory for innovations in the crypto space before they can be ratified.
As part of the bill, innovators will have to enter into an enforcement compliance agreement with regulators, which will help them to work in compliance with regulations and take out any unnecessary roadblocks. McHenry isn’t the first person to sound on the need to preserve innovation in the crypto space. While speaking at the Securities Enforcement Forum in Palo Alto on May 6, Hester Pierce, a commissioner at the SEC who is also known for being rather crypto-friendly, called out the agency for continuously dragging its heels with cryptocurrencies
As she puts it, the agency has been sluggish in clarifying and updating crypto rules, essentially stifling growth and innovation in the space. In part, she said that while hasty regulation would have killed the industry in its infancy, the SEC’s pace has done nothing but show an agency unwilling to take meaningful action at all.