Law Decoded, Sept. 5–12: The pressure is growing in the US
While last week brought no troubles from the market side of the crypto industry — no operations frozen, no bankruptcies filed — the United States regulators made some explicitly negative statements.
Recently appointed U.S. Federal Reserve Board vice chair for supervision Michael Barr pledged to “ensure that crypto activity inside banks is well regulated, based on the principle of the same risk, same activity, same regulation, regardless of the technology used for the activity.” In Barr’s opinion, people “may come to believe that they understand new products only to learn that they don’t.”
Michael Hsu, an acting comptroller of the currency at the annual conference of the Clearing House and Bank Policy Institute, mentioned stablecoins and the collapse of Terra (LUNA) — now renamed Terra Classic (LUNC) — as an example of crypto’s disruptive potential. He also noted that the relationship between banks and fintech companies is evolving rapidly and causing “de-integration” in the financial sector.
The White House Office of Science and Technology Policy has weighed in on the environmental and energy impact of crypto assets, focusing on their contribution to energy usage and greenhouse gas emissions. Among the broadly written recommendations are assessment and enforcement of energy reliability in light of crypto mining projects, setting energy efficiency standards and research and monitoring.
Enforcers participated in the collective push as well. Gurbir Grewal, the enforcement director for the Securities and Exchange Commission, promised the financial regulator will continue to investigate and bring enforcement actions against crypto firms, despite the narrative of “picking winners and losers” and “stifling innovation.” He pushed
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