Like the SEC, the derivatives trading regulator the CFTC also works to regulate the prediction markets.
The United States Securities and Exchange Commission (SEC) has moved closer to building walls to determine the regulation of cryptocurrencies.
In a recent commission-level guidance submitted to the White House Office of Information and Regulation (OIRA), the SEC explained how securities laws can be applied to crypto. If followed, the new guidelines could affect how crypto-focused companies register and operate their businesses in the country.
New guidelines for the crypto market
According to OIRA’s website, the directive is titled “Applicability of Federal Securities Laws to Certain Types of Cryptographic Assets and Certain Transactions in Crypto Assets.”
The website shared rare details about the SEC filing. However, an SEC spokesperson told Bloomberg that the financial agency will “review interpretive guidance on the taxonomy of tokens for crypto assets.” This means that factors such as crypto-specific properties, behavior, and use cases of crypto are used to determine whether or not securities laws apply.
With these guidelines in place, crypto companies knew how to proceed with registration, operations and attracting investors. It is important to note that leadership at the commission level has more power than employee leadership. However, it lacks the requirements for rulemaking that include processes such as public notice and comment.
The latest move is in line with Paul Atkins’ goal to bring crypto-friendliness to the country since becoming SEC chairman. A few weeks ago, he hinted at the agency’s commitment to establishing structural cryptographic regulations despite the cryptocurrency’s falling price.
CFTC calls for regulation of prediction markets
The SEC is not the only Wall Street regulator advocating for a crypto-friendly regulatory framework. On March 2, the Commodity Futures Trading Commission (CFTC) submitted a measure to the White House’s OIRA regarding futures markets.
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CFTC Chairman Michael Selig shed light on the market’s anticipatory measures, saying:
“We’re going to set very clear standards for what can and can’t be self-certified in our marketplaces and how to evaluate the different products that are offered in the space.”
The CFTC’s latest move comes amid increased investor interest in prediction markets, popularized by leading platforms Polymarket and Kalshi.
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