The crypto community is not in splits when it says that the US Securities and Exchange Commission should do more to protect the industry amid the rise in crypto frauds. Gary Gensler, the Chairman of the SEC (Securities and Exchange Commission), however, has cited that crypto ventures don’t want to fall into the category of being regulated and yet take all the advantages for protection.
There is a lack of uniformity at the global level about how digital assets should be regulated. Every country is treating them differently, with some registering positive results while others still possess a dubious mind on whether to regulate them or not. And if they should be regulated, then how will they be regulated?
It has been said that the SEC has not laid down any clear and concrete regulatory structure for investors to follow. Simply put, there is fear and uncertainty in the minds of investors only because the SEC is not taking a stand with its regulatory movements.
SEC and bear market correlation
It has not been proven till the moment. Statements have nevertheless been made saying that the SEC is contributing to the bearish sentiments of the crypto market. It makes sense to a certain extent when members claim that they are seeking a structured guideline for cryptocurrency investment. What marks contradiction is the same sphere making a comeback with a rise in its trade value.
For instance, BTC is way above the $30k mark, and ETH has climbed stairs to go beyond the $1,500 milestone. All of it has happened in the last two months. Not that inaction from the SEC is not affecting them; opinion just goes to suggest that there could be many more factors for a shift in market sentiments, and the SEC is a part of it with considerable impact.
Bitcoin fraud, for example, has been credited to inactions by the SEC, creating a vacuum that malicious actors are exploiting to break investors’ confidence. All they want is to feel safe when diverting their funds into the market.
BTC prices are going up as we draft this article. Bitcoin community members have emphasized that the price may be affected in the short and medium term if the SEC remains inactive in acting to regulate Bitcoin fraud.
The SEC has taken action by filing lawsuits against cryptocurrency businesses like Binance and Coinbase. The Commission is seeking course correction with the argument that inventors and issuers have not done anything to lose the protection of securities laws.
The SEC needs to take action to protect investors from Bitcoin fraud
The SEC needs to take steps, per the whispers making rounds in the market, and they have to select directions. There is a vacuum being exploited to further damage the bear market, which is on the rise for a shift to the bull, and only actions can repair the potholes.
- The SEC is required to publish guidelines regarding Bitcoin and other digital assets. The draft needs to reflect a clear and comprehensive set of guidelines, giving clarity and confidence to investors irrespective of their duration in the market. Bitcoin’s classification under the US Securities Law would carry the flag of risk reduction.
- A dedicated task force is needed to send a message to malicious actors that the SEC is not inactive and is indeed taking measures to protect the segment. They may not be entirely discouraged, but fraud will significantly decrease.
- Collaborate with other countries like Canada and Paraguay, where Bitcoin miners are not just shining but also pushing the local economy forward. They have aligned their activities with the carbon goals of countries. Thereby, pushing local GDP, enticing a breed of investors, and demonstrating their responsibility toward the environment.
Riot has even reported a monthly record of $31.7 million in terms of Power and Demand Response Credits for August this year.
Implications for Bitcoin price
BTC is trading at $33,966.40 at the time of writing this article. This is a longer jump from the $28k mark at a time when the SEC is being accused of not taking any action. The concern is that effects will be felt for a medium and short time if the Commission retains its stance. The only way for the segment to bounce back to its all-time high value is if a structured guideline is implemented.
Investors would be more confident, going on an investment spree by accumulating more tokens in their wallets. A higher investment will only mean that the economy is getting back on track, provided real-world utilities don’t take a backseat.
While there is no surety that the SEC will take all the actions mentioned above, there is still some hope that at least some imperative measures will be brought to life to bring down Bitcoin fraud. This will further boost confidence in investors’ minds and help stabilize the price of BTC plus other digital assets. Last but not least, the SEC action would benefit Bitcoin’s long-term development because of the market’s increased stability.