Apparently advocates of cryptocurrencies are in favor of regulation after all.
As part of the push to mainstream crypto, advocates are asking Congress to pass legislation establishing clear rules and regulations for digital assets.
Industry insiders testified Tuesday before the U.S. House Financial Services Subcommittee on Digital Assets, stressing the need for market structure legislation, stablecoin rules, and better regulatory coordination.
Witnesses including Jonathan Jachym, global head of policy and government relations for crypto exchange Kraken, are calling for the SEC and CFTC to improve collaboration, especially for spot market oversight, and for Congress to establish a clear regulatory framework for crypto businesses. Without federal clarity, Jachym warns that the U.S. could risk losing ground to global competitors.
“We think there’s a real opportunity early in this congressional cycle to get this to the finish line,” Jachym told Institutional Investor before the congressional hearings. “Let’s get this bill done so the U.S. can catch up with the rest of the world.”
Jachym argues for clear U.S. regulations for centralized intermediaries in digital assets. “After many years of legislative work, the time has come for Congress to pass market structure legislation to ensure the U.S remains at the forefront of innovation and the next era of the global financial markets,” Jachym said in his testimony, adding that this would help U.S. regulators engage foreign counterparts to rationalize cross-border market access and support global integration in digital asset markets.
Kraken’s Jachym is advocating for granting the CFTC the power to regulate spot markets, exemptions for decentralized protocols, and clarity on staking services. He highlighted global regulatory advances in other major overseas markets like the EU, U.K., and Canada. He’s also calling for the U.S. to move beyond its current policy of enforcement-based regulation toward bipartisan consensus to support innovation and financial inclusion. He cited the FTX fraud case as an example of “why it’s so important to put basic market structures rules in place.”
Daniel Gorfine, adjunct law professor at Georgetown University and founding CEO of Gattaca Horizons, agreed that “there is some real bipartisan interest in providing greater clarity around the digital asset space.” He added that the SEC’s enforcement approach to crypto under the Biden administration led to “mixed results,” and that it’s critical “to clarify definitions and jurisdictional boundaries.”
While enthusiasm for crypto has accelerated in light of President Donald Trump returning to the White House, experts have warned about how the push to deregulate digital assets could lead to increased fraud and instability. Georgetown finance professor James Angel recently told II that integrating digital assets with mainstream financial systems before implementing “basic consumer protections” is incredibly dangerous, and that regulators need to “make sure intermediaries that handle” cryptocurrencies only deal with those “that comply with the rules.”
This move to regulate digital assets contradicts crypto enthusiasts’ longstanding calls for deregulation, signaling a growing recognition of the need for oversight in the space. This shift also stands in stark contrast to the White House’s broader agenda of dismantling rules and consumer protections. Case in point, Trump just ordered the shutdown of the Consumer Financial Protection Bureau.
The nascent presidential administration has made it clear that it’s all-in on crypto. Paul Atkins, Trump’s pick to replace Gary Gensler as SEC chair, is strongly in favor of regulations that encourage innovation in crypto. Last month, Trump ordered the formation of a crypto task force aimed at developing new regulations for digital assets and possibly forming a national reserve for cryptocurrencies. Because of this, Gorfine rejects the idea “that creating a federal supervisory regime is deregulatory,” especially since “currently, there is no federal supervision for digital commodities.”
Despite the red flags, crypto advocates remain optimistic that regulatory clarity is within reach — and will pave the way for sustainable growth in the industry.
“There are a lot of components in the crypto ecosystem,” Jachym said. “There are going to be policy issues and rapid innovation, but in terms of the task in front of us, the important first step is getting this market structure bill done.”
