US lawmakers hold EU and UK as examples of crypto regulation in joint hearing

Some members of the United States House of Representatives’ Financial Services Committee and Agriculture Committee pointed to crypto asset frameworks being employed outside the country when discussing regulatory gaps at home.

In a May 10 joint hearing on the future of digital asset regulation, some lawmakers pointed to the European Union’s Markets in Crypto-Assets (MiCA) framework and digital asset regulation in the United Kingdom in contrast with the patchwork of requirements in the United States. Responding to questions raised by Oklahoma Representative Frank Lucas, Kraken chief legal officer Marco Santori said the U.S.-based crypto exchange had made plans to invest in the EU and was in the process of investing in the U.K., finding the U.S. regulatory environment difficult to assess.

“Other jurisdictions are indeed pushing ahead – they have been pushing ahead,” said Santori. “These are G20 jurisdictions with sophisticated financial services markets, sophisticated technology industries. The U.S. is significantly behind in that respect.”

House Financial Services Committee ranking member Maxine Waters said there had been some efforts to establish an “entirely new market structure” for crypto in the U.S. amid the lack of clarity among regulators, including the Commodity Futures Trading Commission and the Securities and Exchange Commission. Wisconsin Representative Bryan Steil added the U.S. Congress was ready to provide crypto regulation but suggested there was “a much more forward-thinking approach” in Switzerland and Europe.

“Switzerland provided very early on for a very clear regulatory framework,” said Web3 Foundation chief legal officer Daniel Schoenberger in response to questioning from Steil. “This framework that they provided certainly provided the legal certainty to be headquartered there and to have legal clarity around the classification instantly.”

Related: US lawmakers planning to reintroduce bill aimed at fixing crypto reporting requirements: Report

Steil implied that jurisdictions including the EU with MiCA, Dubai with its Virtual Assets Regulatory Authority, Singapore and South Korea were “not driving forward through a regulatory approach but putting forward rules and regulations of the road.” Such an approach, the lawmaker suggested, could encourage investment and innovation.

Congress has scheduled several hearings in May to discuss digital asset regulation, the recent failure of major banks and oversight of federal financial regulators. 

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?

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