Republican Congressman Warren Davidson made an appearance on CNBC’s Squawk Box on Thursday (June 21) ahead of the upcoming SEC regulations, and had a surprisingly positive outlook on the future of the crypto market and ICOs. Davidson said Bitcoin and Ethereum will soon be classed as “commodities” while the ICO market needs a “light touch” regulation wise.
Republican politician Warren Davidson is a Congressman from Ohio State, and a member of the U.S. House Of Representatives. Still only 48, Davidson – a former US Army Ranger – is young enough to fit the demographic of a cryptocurrency user, so he was a good choice to appear on CNBC’s Squawk Box on Thursday.
When asked about the impending SEC (Securities and Exchange Commission) regulations for cryptocurrencies, Davidson may well have surprised some viewers when he stated that the main thing the crypto market needs is a “light touch regulatory framework.”
SEC Considers Ethereum A “Commodity”
Davidson went hard on the importance of defining the status of cryptocurrencies, citing the example of the SEC’s recent announcement that Ethereum will be considered a commodity rather than a security or a currency.
Davidson also revealed that the US government still “hasn’t put together” a coherent regulatory framework, claiming that there’s still “arbitrage going on.”
One of the points Davidson made was:
“You don’t really know when somebody does an ICO, whether they are really launching this great distributed ledger product that is going to be a security or if it looks a little different, like [Ethereum] and [Bitcoin] determined to be essentially commodities.”
Davidson explained that in his opinion, a “lightweight regulatory framework” could work well, providing product clarity to investors, yet avoiding obvious and archaic regulations. Davidson believes a clear regulatory framework would simplify the nature of cryptocurrency to investors, while avoiding the time wastage brought about by ponderous bureaucracy.
The congressman also drew attention to an inescapable fact: The current lack of regulation make ICOs potentially a magnet for criminal activity. Fraudulent ICO projects could take advantage of investors, and currently the market is certainly risky and potentially unsafe.
The Congressman called for ICO organizers to KYC (Know Your Customer,) and anti-money laundering funds, so as to “make sure we protect ourselves.”
Crypto The “Currency of Choice” For Criminals?
Davidson was then asked if regarded crypto as the “currency of choice” for people engaging in criminal activities, possibly on the so-called “Dark Web.”
“I’m not sure that it would be considered the currency of choice, but it is easy to transmit through time and space, and its distributed, you don’t need a central clearing house… but if you look at how cases like Mt. Gox have been solved, there are ways to trace who is the beneficial owner…”