The US Cryptocurrency Regulatory Dilemma: Dispersed Power, Insufficient Resources, and Market Risks

【Blockchain Rhythm】The U.S. Congress is working on establishing a legal framework for digital assets, with the initial goal of encouraging innovation while preventing illegal activities. But here’s the problem—the agencies responsible for regulation are themselves in a concerning state.

First, let’s look at the stablecoin regulation bill, the “Genius Act,” which disperses key responsibilities across multiple departments, with the Office of the Comptroller of the Currency (OCC) playing a critical role. Unfortunately, this agency has recently experienced layoffs and cyberattacks, leaving it significantly weakened. Next, consider the “Clarity Act,” which would diminish the SEC’s authority and assign most tokens to CFTC jurisdiction. It sounds like power is being redistributed, but there’s a practical issue: CFTC’s budget is only about one-sixth of the SEC’s, and its staffing and enforcement capabilities are insufficient.

Even more concerning is that the Consumer Financial Protection Bureau (CFPB), which once handled consumer complaints related to crypto, has been essentially dismantled, further hollowing out the regulatory defenses.

Bloomberg’s perspective is worth pondering: if, under insufficient regulatory capacity, assets like Bitcoin and Ethereum are pushed to a broader public and institutional investors, frequent exposure of fraud and criminal activities could backfire and harm the entire industry.

What is a more pragmatic solution? Establishing a unified legal framework for trading that covers all difficult-to-classify digital assets, with rules jointly formulated by the SEC and CFTC to ensure market stability, investor protection, and transparent information disclosure. But ultimately, until Congress truly grants regulatory agencies enough authority, expertise, and resources, the crypto market will still face the risk of “buyer beware.”