U.S. Crypto Regulatory Fight Has Everything But Rules: QuickTake

A chunk of Washington has been working to figure out what to make of cryptocurrencies. For some, the question is how to regulate the digital assets; for others, it’s how to cash in on them by influencing the debate. Lawyers and lobbyists have reinvented themselves and new trade associations have sprouted up across town. But Congress has been reluctant to pass new rules, financial regulators are still sorting out jurisdiction and the White House has yet to weigh in forcefully. That’s left confusion and legal risks for U.S issuers and investors. Here are some of the key policy questions:

It depends which agency you ask. The nation’s main swaps regulator, the Commodity Futures Trading Commission, has since 2014 defined virtual currencies as commodities and has asserted jurisdiction over their derivatives. Tax authorities consider them property for tax purposes. But all eyes in the crypto world are on the Securities and Exchange Commission. The SEC has said many coins are likely unregistered securities that violate the law, but hasn’t weighed in on specific currencies or introduced a bright-line test. Officials at the SEC and the CFTC, which thus far has focused on Bitcoin, meet regularly to sort out policy and jurisdictional issues. Meanwhile, the Treasury Department says firms must comply with its anti-money laundering rules under the Bank Secrecy Act.