Crypto Regulations Forecasted to Become Friendlier by 2025 Amid Positive Policy Developments
Summary:
Crypto industry leaders anticipate a friendlier regulatory environment by 2025 due to recent favourable policy developments. Key signs include probable Bitcoin and Ethereum ETF approvals and progress in stablecoin frameworks. However, analysts warn that challenges may arise as the US SEC maintains authority over projects that categorize their tokens as commodities rather than securities. Shifts in crypto regulation are also evident globally, with recent Bitcoin and Ethereum ETPs debuting on the London Stock Exchange, and Hong Kong considering allowing Ether ETF issuers to stake custodial Ether.
Crypto industry insiders are predicting a friendlier regulatory environment for cryptocurrencies by 2025, following a series of policy advancements that favour the sector. In a May 23 opinion piece, Bloomberg's senior policy specialist, Nathan Dean, expressed confidence that the year could mark a watershed moment in crypto regulation. He pointed to hopeful signs including probable approvals of Bitcoin and Ethereum ETFs, the support of 71 House Democrats for the FIT Act and progress on stablecoin frameworks by year-end.
Invoking caution, Dean reiterated that the US SEC retains the purview to regulate projects that attempt to categorise their digital assets as commodities, not securities. However, he referred to such challenges as "nice to have," given that they signify evolving legal understandings of the crypto sphere.
His colleague, Eric Balchunas, also concurs on the optimistic forecast. Referring to a letter that a bipartisan group of Representatives sent to SEC Chair, Gary Gensler, Balchunas praised its promotion of crypto investment within a controlled, transparent, and safe framework. The Bloomberg analyst expressed astonishment at the convergence of ETFs, mainstream political discourse, and election year narratives.
Interestingly, a regulatory shift in crypto is not exclusive to the US. On May 22, Bitcoin and Ethereum exchange-traded products (ETPs) went live on the London Stock Exchange, thanks to approval from the UK's Financial Conduct Authority. Despite the current limitation of these ETPs to professional investors, the endorsement of the CryptoUK spokesperson emphasizes its potential contribution to the UK's aspiration of becoming a global crypto hub.
Cointelegraph reported on the following day that the Hong Kong Securities & Futures Commission is mulling over permitting its Ether spot ETF issuers to stake custodial Ether, thereby offering yields of 3.6% per annum by authenticating blockchain transactions and delivering them to shareholders. However, plans are still in the conceptual phase. Furthermore, the same day may see a significant decision by US regulators on a spot Ethereum ETF, inciting a rally among key cryptocurrencies.
Published At
5/23/2024 8:53:37 PM
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