[{"category":{"name":"Trending News","exported_url":"trending-news"},"id":"bfda1d49-9b38-41d8-9efd-6df4d2d6378c","updated_at":"2024-06-06T02:14:34.858+00:00","account":{"firstName":"Mason","lastName":"Thompson"},"description":"Crypto regulations have long been a hurdle. But with bipartisan action and the SEC's nod to Ether ETFs, the outlook shifts. Could this unlock a flood of advisor investment?","sapo":"Crypto poised for a boom? The regulatory shift in the US could unlock a massive $20 trillion investment from the financial advisory industry, predicts Bitwise's investment chief.","title":"Crypto on the Verge: US Regulatory Shift Could Unlock $20 Trillion Flood","content":"

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The crypto market could be on the cusp of a massive transformation, fueled by a potential shift in US regulations. This, according to Matt Hougan, Chief Investment Officer at Bitwise Asset Management.

Hougan argues that the biggest barrier to wider adoption of crypto by financial advisors – the $20 trillion financial advisory industry – is the lack of regulatory clarity. In a recent post, he highlights recent developments that signal a potential change in US policy, paving the way for investment.

Traditionally, financial advisors have been hesitant to embrace crypto due to the uncertain regulatory landscape. However, Hougan identifies positive signs. The bipartisan repeal of Staff Accounting Bulletin 121 (SAB 121) and the House's passage of the Financial Innovation and Technology for the 21st Century Act (FIT21) suggest a growing willingness to address crypto regulations. Additionally, the SEC's approval of spot Ether ETFs in May indicates a potential shift in the regulatory stance.

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While President Biden's veto of the SAB 121 repeal is a temporary setback, Hougan remains optimistic. He emphasizes the vast potential of the crypto market, which remains largely untapped by mainstream finance. He believes that once the regulatory fog clears, a significant portion of the $20 trillion in financial advisory assets could flow into crypto, mirroring the positive impact of BlackRock's recent foray into the space.

However, Hougan acknowledges the need for concrete action. Though the tide seems to be turning, with the launch of approved ETFs and the potential passage of FIT21 awaited, no major policy changes have been implemented yet.

Top 5 US regulatory shifts affecting Bitcoin:

IRS Tax Guidelines (2014): Bitcoin is treated as property for tax purposes, impacting how gains are reported and taxed.
FinCEN Guidance (2013): Exchanges and administrators of virtual currencies must register with FinCEN and comply with AML and KYC requirements.
SEC vs. ICOs (2017): The SEC considers ICOs as securities offerings, subjecting them to federal securities laws and increasing regulatory scrutiny.
OCC Interpretations (2020): National banks are allowed to provide cryptocurrency custody services and use stablecoins for payments, integrating crypto into traditional banking.
Infrastructure Investment and Jobs Act (2021): New reporting requirements for crypto transactions, extending "broker" definitions to exchanges, aiming to improve tax compliance and transparency.

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Crypto on the Verge: US Regulatory Shift Could Unlock $20 Trillion Flood

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