According to the JPMorgan Report, US Legislators Should Urgently Create a Regulatory Framework

JPMorgan (JPM) stated in a research report on Thursday that the SEC’s lawsuits against Binance and Coinbase highlight the need for American lawmakers to develop a thorough framework on how to regulate the cryptocurrency industries and the relative responsibilities of the SEC vs. the Commodity Futures Trading Commission (CFTC).

According to the JPMorgan Report, US Legislators Should Urgently Create a Regulatory Framework

According to the report, the SEC believes that the majority of cryptocurrencies should be classified as securities. As such, the majority of crypto firms and trading should be subject to its oversight and adhere to the same regulatory frameworks as traditional securities.

The classification of which cryptocurrencies as securities is unknown, and this is not a “straightforward legal case,” according to analysts led by Nikolaos Panigirtzoglou. This murky legal landscape is evident in the SEC v. Ripple case.

SEC Filed New Lawsuits Last Week

According to the regulator’s announcement last week, federal securities laws were allegedly broken by Binance, Binance founder and CEO Changpeng “CZ” Zhao, and Binance.US. It filed a similar lawsuit against Coinbase (COIN), a rival exchange, the next day.

This move creating more urgency for U.S. lawmakers to come up with a comprehensive regulatory framework by this year,

JPMorgan

Cryptocurrency activity will probably keep migrating to decentralized entities and locations outside the United States until this happens. The bank predicted that funding for cryptocurrency venture capital would likely stay low.

About JPMorgan

JPMorgan Chase & Co. is an American financial services holding firm with its main office in New York City. By market capitalization, JPMorgan Chase is the biggest bank on the planet as of June 30, 2021.