Key Takeaways
- Hoskinson wants the crypto industry to have a “self-certification system” that could automatically monitor compliance until an anomaly is encountered.
- He wants the legislators to allow the crypto sector to create self-regulatory organizations like the private banking industry.
Cardano co-founder Charles Hoskinson testified in front of the US Congress, seeking more clearer crypto regulations. While pitching to the US Congress, the Cardano founder suggested that the crypto industry should create a “self-certification system” that could automatically monitor compliance until an anomaly is encountered, at which point a financial authority can review it.
Commenting on the recent crypto regulatory efforts put forth by Congress, Hoskinson stated that compliance with regulation and legislation coming out of the US must be a driving value for the blockchain industry. The Cardona Co-founder stated that since cryptocurrencies can store and transmit data, they could perform much of this regulatory function automatically. He wants the legislators to allow the crypto sector to create self-regulatory organizations like the private banking industry, which serves as a model for regulation compliance.
Hoskinson told legislators that “it’s not the SEC or CFTC going out there doing KYC/AML; it’s banks. They are the ones on the front line.” He also pointed out that self-regulation would help ensure that the industry is “following best practices” and would prove to be more effective than “a bunch of different agencies” trying to regulate the crypto space. Cardano founder further urged US Congress to establish regulatory boundaries and leave compliance up to the software developers.
Hoskinson’s pitch to the US congress comes against the backdrop of the Congress considering how to approach regulation of the cryptocurrency industry in the country. The hearings are part of an effort by legislators to understand in depth about the crypto market so that they can frame regulations accordingly
The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are currently fighting to grasp control over the crypto regulatory phase. Earlier this year, SEC Commissioner Hester Peirce told the media earlier this year that while the SEC is already acting using the authority that it has, she thinks “it would be helpful if Congress came in and said, ‘SEC, here’s the role we think you should be playing. CFTC, here’s the role for you.’”
Several other prominent people have also echoed Hoskinon’ s views on crypto regulation. In 2021, SEC Commissioner Hester Peirce said that a lack of regulatory clarity was responsible for the SEC rejecting spot Bitcoin ETFs from coming to market in the United States. Senators Cynthia Lummis, R-Wyo., and Kirsten Gillibrand, D-N.Y., have recently made a bill that lays out a comprehensive framework for regulating the crypto industry and divvies up oversight among regulators like the SEC and CFTC.
