At Senate Hearing on Cryptocurrency, SEC Chairman Hints at the Need For New Legislation

At a Senate committee hearing on cryptocurrencies, Securities and Exchange Commission Chairman Jay Clayton indicated that the agency could seek new legislation to help enforce oversight of the of the crypto space, including initial coin offerings.

Clayton, joined by J. Christopher Giancarlo, chairman of the U.S. Commodity Futures Trading Commission (CFTC) at an open session of the Senate’s Committee on Banking, Housing and Urban Affairs on Tuesday, was asked by Sen. Richard Shelby (R-AL) whether the two agencies would need “additional legislation in this area” or whether they could “work a task force together to get your arms around this.”

“I can’t give you a definitive answer to that question because we should work together, but, senator, we may be back with our friends from the Treasury and the Fed to ask you for additional legislation,” Clayton said.

Clayton also addressed the question about the value of Bitcoin and other virtual currencies.

“There are a lot of smart people who think there is something to the value of the cryptocurrency and the international exchange,” he said. “I am not seeing those benefits manifesting themselves in the marketplace yet. I look at this from the perspective of protecting Main Street investors and they should understand that.”

Meanwhile, Senator Jack Reed asked both Clayton and Giancarlo whether they had the qualified “technologists” on staff who understand the virtual currency market. Giancarlo noted that the CFTC hired its first ever chief innovation officer last year, who “comes with a deep background in a lot of these new technology innovations,” while also creating a new innovation unit called Lab CFTC based in New York City.

However, Clayton also acknowledged that the agencies could use additional people on staff to help with oversight of the cryptocurrency space.

“In an emerging area like this, could you use more horsepower? Always,” Clayton said.

You can read Clayton’s prepared statement here and Giancarlo’s here. You can also watch video of the full hearing here.

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