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Members of the Democratic Committee of the US Congress are preparing to approve strict regulation by the Securities and Exchange Commission (SEC) of digital assets in their efforts to establish control over the cryptocurrency industry.
A new memorandum pointing to a digital asset regulation hearing has been circulated to a committee of Democrats, sparking a backlash among top crypto leaders.
In a May 14 tweet, Cardano founder Charles Hoskinson denounced the memorandum, urging Americans to consider it a top priority in the next presidential election. Hoskinson advised US citizens to become voters on one issue and support digital asset candidates in the next election cycle.
Democratic lawmakers and their anti-crypto stance
The founder of Cardano believes that the memorandum says that the Democrats and the US government are planning a major crackdown on digital assets.
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In a tweet, Charles Hoskinson noted that the only way to prevent “government regulatory frenzy on cryptocurrencies is to make it a priority during elections.” He called on cryptocurrency enthusiasts to vote for candidates who support digital asset legislation.
His message came in response to a tweet by Eleanor Terrett. The memo called for Democrats on the House Financial Services Committee to support the SEC during the hearing, Terrett said.
The move means the SEC could gain full power over digital asset oversight by expanding its digital asset “regulatory policy.”
The memorandum goes on to note that almost all cryptocurrencies are securities, and the problem with regulating cryptocurrencies is not its ambiguity, but “massive non-compliance.”
In addition, the memorandum drew attention to members of the Republican committee advocating budget cuts in front of financial regulators.
In addition, the notice stated that such Republicans were not “interested in protecting the interests of investors.” He recommended that Democrats focus on passing a net debt ceiling bill “instead of supporting cryptocurrency legislation.”
The content of the memo caused a reaction in the cryptocurrency community, with more than 900,000 people commenting on Eleanor Terrett’s tweet. Several cryptocurrency experts and industry leaders have raised concerns about the potential direction of regulation.
Respondent Jeff Beach frowned at the meme, noting that the move could push innovation away from the US.
Are there pro-digital asset Democratic lawmakers in the US?
Although the majority of US Democrats oppose cryptocurrencies, the nascent industry still found a supporter among them. In March 2022, prominent Democratic Senator Ron Wyden expressed support for the industry.
The senator urged his colleagues to be careful when regulating cryptocurrencies, noting that crypto-currency innovations have provided several opportunities for settlement.
As a former pioneer of internet regulation in the US, Wyden compared cryptocurrencies to the early days of the internet. At that time, the government established legal safeguards to protect online platforms from lawsuits for public content published on them.
The senator highlighted the need for legal protections similar to section 230 of the Communications Decency Act for digital asset platforms.
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