How crypto regulations can be healthy
Many people are curious as to what the distinction is between BTC, which is most likely not a security, XRP produced by Ripple, and the FTX coin. Just how much longer can Gary make us wait for clarity in the space, I wonder. The best we could do is to issue a cease letter, but only when those institutions falsely claim that the FDIC Eagles have approved the account. Markets already have the bank's offer and its products. They are practicing banking without a license when they do everything else. They should not be allowed to do so, but the current regulatory framework is probably insufficient to do so.
The infamous FTT token, which was released by FTX, collateralized, and utilized as the foundation by other organizations, has the odor of quackery security. Because they are aware of it and did not want to, the SEC did not shut it down under the zealous anti-crypto chairman Gary Gensler. It is because there is uncertainty regarding the current regulatory authority to do so. Further legislation is necessary to resolve those issues, and that regulation must grant them the forbidden power. Saying you can't do anything simply by labeling your activities with a new technologist, the jargon-heavy label, is how other regulatory agencies respond to your actions. It is a stage where a more complex regulatory environment and a more crypto-specific regulatory are needed.
While cryptocurrency initiatives continue to test the limits of decentralization and community governance, this year represents a turning point for regulation in the industry. Via innovative enforcement measures, the SEC and CFTC will probably push the limits of their current legal authority. 2023 will be the year of regulation vs decentralization since neither body is prepared to release new crypto regulations. Although I believe respectable actors in the crypto space desire regulation, the actors in the sector do not want regulation. Large institutions seek regulation because it benefits their operations and clients, and the path to this goal is through explicit regulation.
Predictable consequences result from clear regulation that is consistently applied, and everyone benefits from predictable outcomes. If you don't know what the law requires, you can't comply with the law and the law inconsistently implemented leads to unpredictable outcomes which are not going to be good for anybody. That, in my opinion, is the definition of sound regulation, and I believe that in the cryptocurrency industry, we are making progress in that direction.