A digital asset lawyer at K&L Gates said there is hope that the U.S. will see a new cryptocurrency resurgence after several rulings this year that put court judges “in control of the SEC.”
On Aug. 31, Jeremy McLaughlin, a partner at the global law firm, noted that multiple U.S. court cases have refuted the arguments of SEC Chairman Gary Gensler, The latter has said that almost all digital assets are securities.
McLaughlin was speaking on a panel at Intersekt23 in Melbourne, along with Effie Dimitropoulos, chief executive of payments services firm Novatti, and King Leung, head of fintech at Invest Hong Kong.
Early cryptocurrency regulation was at the state level and “was very clear about what you needed to do,” but after the SEC and CFTC stepped in, “a lot of markets started to close,” he said.
“People are delisting tokens, some companies are pulling out of the U.S. because they see how aggressive the SEC is and will continue to do so,” McLaughlin said.
“Now that the courts are starting to impose some restrictions on the SEC, I think there is hope for the industry to be rekindled in the US”
In recent months, the U.S. Securities and Exchange Commission has lost a lawsuit against a cryptocurrency company and lost a lawsuit against it by a cryptocurrency company.
On Aug. 29, a U.S. District Court judge ruled that the SEC should deny Grayscale Investments’ application to convert its flagship Bitcoin (BTC) fund into an exchange-traded fund.
The U.S. Securities and Exchange Commission (SEC) also suffered some losses in July in a case against Ripple Labs over sales of XRP (XRP), when a judge ruled that XRP was not a security when it was sold to retail traders.
“As a lawyer in the field, it’s very difficult to advise clients,” McLaughlin said. He added that his inability to give clients clear answers was also frustrating.
He does, however, see hope that cryptocurrency regulation is emerging from the “abyss of chaos.”
McLaughlin added: “In the end, there are cases that are being filed and the verdicts have been very favorable to the digital asset industry.”
Australians ‘falling behind’ while others gain
In another part of the discussion, panelists were asked for their opinion on the state of crypto legislation in Australia compared to other countries. Dimitropoulos of Novatti has a word: “lag”.
Dimitropoulos pointed to the new regulatory frameworks in Hong Kong and the European Union as proof that cryptocurrency regulation in Australia is lagging behind.
“Obviously Australia has fallen behind. What does that mean? […] This is how it affects on-the-ground businesses operating with digital assets. “
She highlighted the overhead required for local cryptocurrency companies to obtain legal advice “that can expire in three minutes.”
related: Coinbase Stock Soars After Federal Government Ruling in Grayscale’s Favor
“We’ve heard that the Treasurer is going to introduce regulatory measures, [the Australian Securities and Investments Commisson] Something will be done and Senator Prague’s bill is working,” she said.
“There’s a lot that’s still going on, but there’s no clear resolution on when that’s going to happen. That backs up my words: ‘Get behind’.”
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Additional reporting by Tom Mitchell Hill.