Year of crypto regulation continues with Treasury focus on financial risks [61]

Coherent regulation would not be a bad thing if managed correctly

Good afternoon, friends!

With all of the crypto regulation and policy news constantly showing up in the headlines, it feels like 2022 is becoming the year of regulation. Perhaps the same could have been said in 2021, but the problems with inconsistent regulations and enforcement continue.

The most recent news comes from the US Treasury-led Financial Stability Oversight Council, which recently recommended even greater regulatory “oversight” over the cryptocurrency industry. This doesn’t need to be a bad thing.

As a government agency tasked with looking out for risks to the US economy and oversight being part of the name, it’s not hard to see that’s exactly what the council came out and asked for from Congress. Requesting laws that would require increased regulation of the industry. However, what’s also important is that the report also requested “attention and coordination.”

This is something that has been lacking between the numerous financial regulatory agencies that oversee the different segments of the industry, or even between State and Federal. As we’ve seen this can create even more confusion for people attempting to stay compliant when dealing with their own crypto trades.

The crypto and blockchain ecosystem has gone through a few fits and starts when it comes to accepting various types of regulatory efforts. One of the most significant was BitLicense, the New York law which set how exchanges operate within the state, however, due to its tight regulatory framework, it is regarded as a poor example of how regulation should be done.

When BitLicense was originally put in place in 2015, multiple exchanges left New York, and since that time only 25 organizations offering crypto services have been accepted under its framework.

Members of the FSOC include members of the Securities and Exchange Commission and the Commodities and Futures Trading Commission. This could lend weight to legislators providing clearer guidelines and laws for helping various federal organizations work together.

As for the state level, it may not always be that safe, in some cases, it’s a learn-as-you-go mishmash of different regulations that can link up differently with Federal regulations. As you might know, this has all been part of some recent things that happened to me.

As usual, check out the news below in the Blockchain Bulletin section and the long-form news below. This includes details about the crypto industry regulations report and more crypto news in the paid section of the newsletter. See everyone next week!

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Blockchain Bulletin

• FreeRossDAO hosting contributor workshops on Discord for prison and criminal justice reform. FreeRossDAO has launched contributor workshops on Discord on some Saturdays from 4 p.m. to 6 p.m., with the first this upcoming weekend. Fill out their onboarding form for details.

• Binance hit with $570M theft of BNB tokens from the Binance Bridge. Cryptocurrency exchange Binance was hit with a hack for approximately $570 million worth of BNB tokens when a hacker exploited the Binance Bridge, reported The Block.

Blockchain Behind the Scenes

• Treasury regulators call for more crypto enforcement. A panel of senior Treasury financial regulators has called for further laws and enforcement into the crypto industry after assessing potential “risks to the stability” of the US economy.

• Greenidge Generation Bitcoin miner seeks to raise $23M. The controversial New York-based Greenidge Generation bitcoin mining operation is seeking to raise $22.8 million to increase its operations amid criticism from environmentalists and state regulators.