SEC To The Rescue Of Cryptocurrency Demonetisation
While many legislatures around the globe are giving shock treatments to digital currency lovers by making all transactions with bitcoins as illegal, these troubled coin owners are looking up to one entity for relief. That is the supreme regulator of trade and stock market and the assets; the US Securities and Stock Exchange Commission.
The spreading demonetization move is preventing the miners and traders to carry out an exchange or transaction in the open market and has left millions of coin owners as guards of worthless currency. These coins may get trapped in the wallets as dead money with no way to enter the open market or another market and affect the cash flow in the economy.
Although there have been efforts to get some relief from the money transmission laws of each local or state governing bodies, it can lead to chaos and overlapping of rules, thereby confusing the traders. As a part of consumer right protection and financial policies, the holding and exchange of these currencies are to be carried out only by licensed money transmitters. In order to enter the open market, the traders have to surpass multiple governing bodies and the rules of each body may differ. This leads to time delay and extra expenditure along with the extra effort of meeting documental requirements and essentially discourage the cryptocurrency traders.
A single regulatory body is a solution
The officials of SEC have made remarks stating that for an investor or a trader to trade on digital currencies, he must register as an official trading entity or use any trading platforms registered with the SEC. He can play the roles of a security trader, broker, dealer or trade using the national securities exchange or other alternative trading systems. This will ease out the rules imposed on money transmitters, who in reality have a different method of activity when compared to digital currency transactions.
Many states exempt the aforementioned trading entities registered with the SEC from their local rules for money transmission license.
As a holder of digital assets and to continue as a trader in cryptocurrencies, you can get relaxation from SEC by utilizing the following tips. Continue with the activity using digital assets which are traded under the federal law and if you have other forms of cryptocurrencies, try to convert them with any loopholes.
If both the above options are ruled out, then you can put the effort to become a licensed money transmitter. Check for any categorical exemptions under the federal laws, as governed by SEC and constructively use them.
SEC can simplify the existing stringent rules and provide clarity regarding various regulatory overlaps, particularly of different states. By acting as a central regulatory authority rectifies all these problems automatically.