By Ike Brannon. March 16, 2022. (Forbes)
The rapid expansion in market capitalization of cryptocurrencies to over $1.7 trillion, the rapid rise of NFTs ($25 billion in 2021, $4 billion in January of 2022) and other digital assets, as well as the dramatic increase in DeFi ($75 billion) staking and liquidity pools ($108 billion as of Dec, 2021), raises two clear questions: how should digital assets such as cryptocurrencies be regulated, and how might this innovative technology add value and benefit to our economy? An SEC enforcement action moving through the Southern District of New York is poised to shape the answers to both questions, due in large part to the aggressive stance toward cryptocurrency represented by the Commission’s legal theory. Legal experts and policymakers had best pay close attention.