As the House prepares to discuss a proposed bill aimed at establishing rules for the crypto markets, Democratic staffers have reported that they are being cut off from essential technical information by the Securities and Exchange Commission (SEC). The upcoming hearing will focus on the Digital Asset Market Clarity Act, which is on the agenda for consideration by the House Financial Services Committee.
Democrats, including Representative Maxine Waters from California, feel they have been denied access to analysis typically provided to lawmakers by the SEC. This technical input is crucial for understanding the potential impacts of the legislation. Staffers indicated that their inquiries submitted to the SEC were met with significantly less information than was shared with Republican lawmakers. Furthermore, the agency reportedly failed to provide its experts for discussions regarding the bill.
Waters expressed her concerns in a letter to SEC Chairman Paul Atkins, demanding a “comprehensive technical and impact analysis” of the crypto market structure bill. She emphasized the need for adequate responses to her questions to ensure Congressional representatives can assess whether the proposed legislation adequately addresses the unique risks associated with crypto and fosters an environment for responsible innovation.
The SEC has stated that it typically accommodates requests for technical assistance from any congressional member seeking it. However, Democratic aides claim that their staff was unable to obtain basic insights during a recent briefing, even from an SEC official who had previously advocated for crypto.
In the broader context, the House committee will be discussing the Clarity Act after its recent introduction, which aims to clarify regulations in the burgeoning crypto sector. This is especially significant as many in the crypto industry argue that the lack of clear U.S. regulations has led to uncertainty among potential investors and has encouraged innovators to relocate offshore.
Democratic staffers have also raised concerns that traditional securities firms might exploit loopholes within this legislation to bypass existing regulations. However, while some Democratic leaders, such as Waters, have been cautious about advancing crypto legislation, others have cooperated with Republicans on the matter, allowing bills to progress through both houses of Congress.
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