Crypto leaders to Congress: Figure out regulation or innovation leaves

The cryptocurrency industry has a plea for Congress: Hurry up and regulate, please.

Nasdaq, State Street, Andreessen Horowitz, and the U.S. Chamber of Commerce filled a room in the Library of Congress. There, they politely but firmly addressed what they deemed unsolved issues as Davidson prepares to introduce a related bill this fall.

“We all want a fair and orderly markets, we want all the same things regulators do,” said Mike Lempres, chief legal and risk officer at San Francisco-based Coinbase. “It doesn’t have to be done in the same way it was done in the past, and we need to be open to that.”

A recurring complaint was the idea of applying a 72-year-old securities law to digital currencies. The U.S. Securities and Exchange Commission uses what’s known as the “Howey Test,” which comes from a 1946 U.S. Supreme Court decision, to determine whether or not a cryptocurrency is a security. SEC Chairman Jay Clayton has made it clear that he does not intend to update those standards to cater to crypto.

Carla Carriveau, senior regulatory counsel at crypto finance firm Circle, who worked at the SEC for more than a decade, said the agency could clarify existing laws and make exemptions, but it would take moves by Congress to make a real impact.

“Congress has to act because the SEC has said what they thought was right, and already did what they thought they needed to do,” Carriveau said.