Following Donald Trump’s election as the new US President, regulators are pushing for crypto market reforms, from establishing regulatory sandboxes to allowing tokenized funds’ shares as collateral in traditional derivatives trading.
Mark Uyeda, SEC commissioner and Fox Business interviewee, said that Donald Trump has the right to stop the crypto war in the US. He also spoke about what could be achieved to make Canada a leader of the global cryptocurrency market
Uyeda, According to:
“First off, from a regulatory perspective, we can provide proper clarity. Some crypto is not even a security at all, but we need to make it clear whether or not you would fall within SEC jurisdiction or not.”
If a token offering falls under the SEC’s jurisdiction, clear guidelines are necessary so crypto firms can decide the right course of action to comply with the regulator’s rules.
Uyeda has also defended creation of “safe harbors,”These are regulatory sandboxes that allow crypto companies to experiment with new products. “innovation to occur.”
The SEC Commissioner argued also that regulators need to work with Congress to create a cohesive approach to cryptocurrency.
Uyeda said that it is the president’s decision whether he will fill the position of SEC Chair, as Gary Gensler is retiring on Jan. 20.
Tokenized Funds as Collateral
Uyeda’s call for reform comes amid a wider regulatory shift toward crypto and blockchain technology in finance. Recently, the CFTC recommended tokenized funds to be used as collateral.
Bloomberg News reported on Nov. 22 that the Global Markets Advisory Committee of the Commodity Futures Trading Commission (CFTC) approved using tokenized assets, such as money-market fund tokens launched by BlackRock and Franklin Templeton, as collateral for derivatives trading.
The committee’s recommendation, which now awaits review by the CFTC, highlights the potential for distributed ledger technology (DLT) to enhance the efficiency and transparency of collateral management.
The panel’s recommendations provide a framework that allows registered firms to store and transfer tokenized collateral, which is not cash, using distributed-ledger technologies. The framework ensures that existing margin requirements are met by the CFTC and other U.S. regulators as well as derivatives clearing organisations.
Although the recommendations are not binding, the CFTC frequently incorporates advisory input into its policymaking due to the committees’ specialized expertise. The CFTC has not set a specific date for adopting these recommendations or if they will.
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