Written by Eric Peters, CIO of One River Asset Management
“There are three immediate actions that can be taken without the need for legislation,” stated the Chairman, as the election results are now in the past and the crypto industry is gaining momentum.
“Firstly, the repeal of SAB 121 can be initiated as soon as the new administration assumes office,” he continued, referring to the SEC’s staff accounting bulletin no. 121 from 2022, which had unnecessarily hindered the industry’s progress, leading investors and innovators to seek opportunities overseas.
“Secondly, there needs to be coordination between the SEC and banking regulators regarding stablecoin guidance, which will integrate stablecoin into the regulatory framework, enabling its widespread adoption within the banking system and capital markets.”
“The integration of dollar stablecoin into the financial system will expedite the development of crypto infrastructure across the US and global financial sectors,” explained the Chairman. “This is in the best interest of the US, as it will promote the use of dollar stablecoin domestically and internationally, thus expanding the global influence of the dollar.” I nodded in agreement. The opposition from the Biden administration towards sensible stablecoin guidance lacked economic and geopolitical rationale. However, these policies will soon be a thing of the past.
“As stablecoin becomes part of the banking system, the groundwork for tokenizing other assets will be laid,” noted the Chairman. “This will encourage innovation in financial markets; reducing costs, increasing efficiency, enhancing security, and providing transparency to all parties involved, including regulators, thereby improving financial stability.” The transition towards blockchain replacing traditional financial infrastructure is underway. “And there is one more critical action that is overdue and needs to be addressed promptly,” he added.
“Thirdly, clear guidance from the SEC and CFTC regarding the trading of tokens in secondary markets should be provided,” stated the Chairman.
“For instance, establishing guidelines that tokens which have been in circulation for two years without new issuances are presumed suitable for trading, as opposed to the contrary, is an example of a measure that can be implemented without legislative intervention.” I smiled, pleased by the common-sense approach.
“By swiftly and responsibly addressing these issues, including tackling anti-money laundering and illicit finance concerns, we can unleash the entrepreneurial spirit of the US in this dynamic industry. It is beneficial for our innovators, the financial sector, and the nation.”
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“We are on the brink of an economic transformation unlike anything you have witnessed in your career,” stated the Oracle, seated calmly on a warm rock. “A comprehensive set of policies aimed at significantly enhancing productivity and growth throughout the US economy.” I had journeyed far to seek the Oracle, whose predictions of political changes months ago were now materializing. “The unlocking of energy resources, the expansion of AI infrastructure to facilitate rapid progress, the reduction of government inefficiencies and staff to pave the way for private sector expansion. Tax reductions.
“The Federal Reserve’s rate cuts have been misguided given what lies ahead,” stated the Oracle, his gaze fixed on the distant horizon. “With increasing productivity growth, the demand for capital will surge, the economy will flourish, and energy prices will remain stable even as supplies increase. The pressure on interest rates will be upward, not downward.” And with that, the Oracle closed his eyes. “I foresee real GDP surging towards a 4% growth rate in the upcoming cycle, and equity markets experiencing gains of 25-30% reminiscent of the late 1990s for the next few years. I have never seen such a bullish outlook.”
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