Elizabeth Warren Calls for Crypto Regulations
Written by: Mary McCarthy
Digital asset regulation is a hotly contested topic that concerns private businesses, legislation, and investors at every level. Senator Elizabeth Warren recently released a statement calling on Treasury Secretary Janet Yellen to consider a comprehensive regulatory framework for digital assets and cryptocurrency trading. Crypto regulations are evolving relatively quickly at the state level as lawmakers strive to keep up with the increasingly popular cryptocurrency world. Wisconsin, for example, was the first state to allow SPDI charters between cryptocurrencies and banks; now, similar charter systems are being passed or discussed in other states.
SEC Chairman Gary Gensler has long called for comprehensive regulations at the federal level. In an interview with CNBC, he said, “Disclosure has been the hallmark for 90 years of our capital markets, that a company discloses what’s relevant to investors; they must have accurate information. At the core, investor protection has helped economic growth and capital formation. It builds trust and confidence in our financial markets, and it lowers the risk premium that someone is defrauding investors. At the core of our public policy is that investors can take risk as long as they have material disclosures that are kept current and updated” (July 28, 2021, CNBC).
Gensler has long stated that for the protection of investors, a more regulatory and cohesive framework is needed to curb market manipulation. Currently, there is very little regulation at the federal level for cryptocurrency transactions. Still, politicians like Elizabeth Warren are pushing for the US to consider more cohesive regulations to protect investors. In a letter to Treasury Secretary Janet Yellen, she wrote that the Financial Stability Oversight Council “must act quickly to use its statutory authority to address cryptocurrencies’ risks and regulate the market to ensure the safety and stability of consumers and our financial system.” Warren noted that as cryptocurrency grows in popularity, protections for consumers at the federal level should at least be considered.
Citations:
Business Insider. (n.d.). Billionaire investor Mike NOVOGRATZ attacks Elizabeth Warren’s anti-crypto Stance, SAYING Defi is far more transparent than banks. Business Insider.
https://markets.businessinsider.com/news/currencies/mike-novogratz-elizabeth-warren-crypto-cryptocurrencies-decentralized-finance-defi-2021-7.
CNBC. (2021, July 28). Warren on crypto REGULATION: Don’t wait Until small investors are wiped out. CNBC. https://www.cnbc.com/video/2021/07/28/warren-on-crypto-regulation-dont-wait-until-small-investors-are-wiped-out.html.
kevin_stank. (2021, July 28). Sen. Elizabeth WARREN shoots down a key reason investors buy Bitcoin, calls for tighter regulation. CNBC. https://www.cnbc.com/2021/07/28/sen-elizabeth-warren-doubts-bitcoin-as-inflation-hedge-wants-tighter-regulation.html. Ponciano, J. (2021, July 28). Sen. Warren Says crypto could solve Big banks”enormous Failure’ of not serving millions of LOW-INCOME AMERICANS. Forbes. https://www.forbes.com/sites/jonathanponciano/2021/07/28/sen-warren-says-crypto-could-solve-big-banks-enormous-failure-of-not-serving-millions-of-low-income-americans/?sh=3e7bf9f319ad.
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