Why The White House Is Urging Congress To Increase The Powers Of Cryptocurrency Market Regulators

Four senior officials from the White House released a statement calling on Congress to increase its efforts in regulating the cryptocurrency market and expand the powers of regulators to prevent misuse of customers' assets and conflicts of interest.

What Happened: The statement also recommended Congress strengthen transparency and disclosure requirements for crypto companies, increase penalties for violations of illicit-finance rules, and work more closely with international law enforcement partners.

The officials also cautioned against allowing mainstream institutions such as pension funds to invest heavily in the cryptocurrency market as it could deepen ties between cryptocurrencies and the broader financial system.

The statement is in line with the recent comments of U.S. regulators, including Commodity Futures Trading Commission (CFTC) Commissioner Kristin Johnson, who called on Congress earlier this week to expand the CFTC’s authority to conduct due diligence on crypto acquisitions.

Also Read: New York Takes A Giant Leap Towards Cryptocurrency Adoption With New Bill

White House officials also announced the Biden Administration would unveil “priorities for digital assets research development, which will help the technologies powering cryptocurrencies protect consumers by default,” in the coming months.

Officials believed these safeguards would ensure new technologies were secure and beneficial to all and the new digital economy works for the many, not just a few.

Why It Matters: The statement came amid growing concerns about the stability of the cryptocurrency market, with the officials warning that 2022 could be a tough year for cryptocurrencies, citing the implosion of a so-called stablecoin and the subsequent collapse of a major cryptocurrency exchange.

White House officials urged Congress to take a more active role in regulating the cryptocurrency market and announced the Biden Administration would unveil plans to protect consumers in the coming months.

Read Next: Traditional Investment Firms Under Scrutiny By SEC For Crypto Compliance

Photo: Shutterstock