The eagerly anticipated Senate Committee’s meeting with CFTC and SEC will be discussing the regulations on cryptocurrency. However, both the agencies have been in the picture for a long time and have taken strict actions against some big investors. Another factor worth mentioning here is the huge reduction in the bitcoin trading volume in past one month.
CFTC and SEC have already been in the Bitcoin regulation game
As we reported yesterday, today CFTC (Commodity Futures Trading Commission) and SEC (Securities and Exchange Commission) in a meeting with Senate Committee are going to discuss their oversight roles in virtual currencies. This has put a lot of strain on the crypto market as well as the crypto investors. However, neither of the agencies aren’t new to the crypto market.
On May 7, 2014, SEC posted a note on their official website entitled “Investor Alert: Bitcoin and other virtual currency-related investments” that explains bitcoin and warns investors of high-risks involved in bitcoin investment.
On September 21, 2017, CFTC filed an anti-fraud enforcement action that involved misappropriation, issuing false account statements and fraudulent solicitation in Bitcoin Ponzi scheme against Nicholas Gelfman (Brooklyn, New York) and Gelfman Blueprint Inc (New York).
On January 18, CFTC charged Colorado Resident Dillion Michael Dean and his (the UK registered) company, The Entrepreneur Headquarters Limited, for engaging in a fraudulent scheme to solicit Bitcoin from the public and investing them in binary options.
On January 19, CFTC filed a federal civil enforcement action against Patrick K. McDonnel and Cabbage Tech. Corp. d/b/a Coin Drop Markets for engaging in a fraudulent scheme involving Bitcoin and Litecoin.
These actions highlight that SEC and CFTC have already been in the picture way long back. It will just be the first time that it will be a common knowledge for the general public at large. This was a smart move on the agencies’ part as the big shot names in these frauds discouraged the local investors and the US didn’t even have to take a global stance on cryptocurrencies.
This could be understood from a slightly similar scenario in India that didn’t make any global announcement regarding crypto regulations but surely have them taxable.
Trading Volume reduced by 450 billion approx. in just 1 month
As per coinmarketcap data, on January 10, 2018 the trading volume of bitcoin was about 750 billion. After just a month, this trading volume is now only 282 billion. It has been expected that this trading volume will soon reach 250 billion. The market has been long before affected, with not only the price but the trading volume which shouldn’t have.
Whatever may be the decision of the Senate Meeting that is held today, the actions have already been taken by the SEC and CFTC. The result of the market hardly matters now. Clearly, the strict actions regarding cryptocurrencies have been taken by these agencies that have discouraged the local investors from investing in virtual currency.
Do you think the decision the committee will reach on will affect the price of bitcoin? What are your views on the whole SEC and CFTC scenario? Let us know your thoughts in our comment section below!
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I am an entrepreneur and a writer with a bachelors degree in Computer Science. I manage the blockchain technology and crypto coverages at Coingape. follow me on Twitter at @arya_achal or reach out to me at achal[at]coingape.com.