Dominic Kimani
The United States government has published a comprehensive framework for regulating cryptocurrencies and non-fungible tokens (NFTs). The new report features recommendations to protect consumers, investors, businesses, and financial stability from risks associated with digital assets.
On September 16, the United States White House published the first-ever comprehensive framework for the responsible development of digital assets. The published framework is in line with an executive order issued by U.S President Joe Biden in March. It recommended proper regulatory measures to protect investors and consumers from the potential risk of digital assets and their underlying technology.
The U.S Gov’t Pushes Regulators To Scrutinize Digital Assets
The framework encourages regulatory watchdogs such as the Securities and Exchange Commission (SEC) and Commodities Futures Trading Commission (CFTC) to aggressively pursue thorough investigations and enforcement actions against unlawful practices in the digital assets space.
The US white house has directed the Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC), and the Financial Literacy Education Commission (FLEC) to monitor customer complaints while making them understand the risk involved in digital assets investments.
U.S Gov’t To Raise Penalties Against Crypto Crimes
The announcement has proposed cooperation between the White House and Congress to amend some federal laws. The White House has urged Congress to increase the penalties for unlicensed money transmitting to penalties accredited to other crimes such as money laundering. The White House recommends that the Department of Justice prosecute digital asset crimes in any jurisdiction where victims of those crimes are found.
The proposed regulations to safeguard investors appear amid the rise of cyber crimes within the digital assets space. Recently, Elliptic research firm revealed that cybercriminals had stolen more than $100 million as of July 2022.
A few days ago, hackers breached the vulnerability in The Sandbox’s social media accounts and redirected followers to a fake giveaway URL. The notorious hackers tried to lend its Bored Ape NFT. However, no loss was reported.
In the meantime, Biden and Harris’ administration requires the Department of Treasury to complete an illicit finance risk assessment on decentralized finance (DeFi) by the end of February 2023 and an assessment for the non-fungible tokens (NFTs) by July 2023.
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This article was written for Business 2 Community by Dominic Kimani.
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