For too long, the United States has lagged behind the rest of the world on the policy of implementation. Now, in the first 30 days of the Trump administration, the clearing was mentioned in the hearings of the Congress, listed as an absolute priority by the newly created cryptographic working group and is today the objective of A bipartite letter from the legislators stimulating the position of the previous dry on its inclusion in the products negotiated in exchange (ETP). Many in the digital asset sector celebrated when the first Ether Spot ether was approved in September of last year. It was a giant jump forward for the second largest cryptocurrency, reaching legitimacy in the eyes of American regulators. But there has been a blatant omission in these financial products: the possibility of taking advantage of assets and profits.
Now a bipartite group of legislators, including Senators Cynthia Lummis (R-Wy), Kirsten Gillibrand (D-NY), Steve Daines (R-Montana), Bill Hagerty (R-Tenn.), Thom Tillis (R-N-NC) , Bernie Moreno (R-Ohio) and Ron Wyden (D-OU) open the way to correct this. Friday, in a letter given to the Securities and Exchange Commission, they dispute the DRI directive to exclude participation in the Protocol in ETPs, stressing how this position could compromise the protections of investors and the competitiveness of the American markets.
The prohibition of the dry to mark out in the ETPs is based on a defective understanding of the way in which the implementation works on networks of staging like Ethereum. Employed is not an investment product in itself. Rather, this is a fundamental technical requirement to secure and validate transactions on proof of assistance networks. When chip holders accumulate their assets, they contribute to network security and, in doing so, earn rewards generated by the protocol itself – not centralized authority.
International competitiveness
The DRI directive to identify ETP Ether issuers to exclude stimulation raises serious concerns about America’s competitive position in the global markets of digital assets. While the United States hesitates, other important financial centers, notably Switzerland, Canada, Germany and Australia, have adopted punctures in their digital andPS assets, recognizing its full role in network safety and operational stability. Last month, the United Kingdom published a statutory instrument recognizing that the provisions for the starring of eligible cryptographic assets are not a collective investment program, strengthening its importance in securing and maintaining blockchain networks.
Because the development is essential to secure the networks of evidence of work, it also means that if there was no milestone in their ether, all the assets within these ETPs would be in danger. This means that, perversely, the SEC has forced American investors to a position where their investments are only protected by assets held in other jurisdictions.
Above all, the impact of these regulations extends beyond the simple Ethereum blockchain, but applies to the possible future and other networks which also use proof of proof like Solana, Avalanche and Polkadot. As the digital asset sector is developing, the impact of these malavized regulations will only deepen.
Make a bad settlement hurts American investors and the American economy. Either investors accept interior products without punctuating and associated awards, limiting their financial returns, or they are looking for an exhibition through offshore alternatives, leading offshore capital and US scholarships. Without marking out, ETP Ether holders gradually lose their relative property position of the network due to the inflationary nature of the rewards of staking.
This economic reality makes the products of us less competitive and less attractive for investors who are looking for a complete exhibition at the Ethereum ecosystem. Even more disturbing, this result seems to contradict the main mission of protection of dry investors, probably pushing investors to investment vehicles in other jurisdictions which may not comply with the protection standards of investors available for investors to UNITED STATES
The technical risks associated with the clears, when managed by sophisticated validators, are minimal and well understood. The “risk of reduction” often quoted – a penalty mechanism for attempts at dishonest validation – only affected 0.001% of the ether marked to date. These data suggest that the prudent position of the dry can be disproportionate to the real risks involved.
What is at stake
While we are waiting for the SEC’s answer to the important questions raised by the Congress, American investors continue to be disadvantaged. The path to follow requires a balanced approach which recognizes the implementation of what it is – a technical mechanism for network safety – while ensuring that there is appropriate surveillance when offered in the products of regulated investment.
As the letter rightly underlines, while only the congress can create a complete regulatory framework, the SEC has the power to allow an exercise of ETPs. This would be aligned both with the agency’s mandate to protect investors and the objective of maintaining American leadership in global financial markets.
The bipartite letter of Congress to the SEC UYEDA commissioners and the Peirce approval protocol in digital andPS assets are an important step for investors – both from crypto and institutional. Uyeda having criticized what he called “the armament” of the functions of application of the law of the dry and the lawyer of the crypto Paul Atkins being nominated to resume the role of president of the dry, we have a rare Opportunity to progress on one of the most common problems in the dry in the landscape of digital assets.
It is beyond the time for the dry to assume a leadership position with regard to the stimulation of the protocol, which feeds the digital asset sector. This is suitable for the aspirations of the American economy and the Americans who count.
