Why Is the US Not Yet a Leader in Crypto Regulation? — Experts Answer

“When new technologies are introduced, regulators are often faced with a similar set of key challenges: how to best protect consumers while fostering innovation, promoting competition, enforcing legacy regulations and resisting the urge to overregulate.

“With respect to blockchain, policymakers have been hesitant to introduce specific regulations for a variety of hurdles.

“First off, blockchain-enabled digital assets are not a homogeneous asset class—they may feature characteristics of securities, commodities, currency units, or a combination thereof—and affect markets that cross national borders. In the U.S., we have various agencies exercising overlapping authority; for example, the Commodity Futures Trading Commission, the Financial “Crimes Enforcement Network, the Federal Trade Commission, the Internal Revenue Service and the Securities and Exchange Commission may have concurrent or overlapping jurisdiction over a particular blockchain-related matter.

“Secondly, while the standard policy cycle often takes several years, emerging companies often develop disruptive technologies with global reach in just a few months. And history has taught us that regulations that are too fast can be just as bad as regulations that are too slow.

“Despite these challenges, U.S. policymakers are calling for action and are showing a strong effort to engage with participants in the blockchain space – a crucial step on the path toward meaningful regulation and guidance.”

— Dario de Martino, Partner in the Corporate Department of Morrison & Foerster, Co-chair of MoFo’s Blockchain + Smart Contracts Group