California is on the right track when it comes to helping all of its crypto enthusiast citizens find a better way to start trading. More specifically, they are all looking for different ways that they can trade in a safe and responsible way.
Lucky for them, the CFC (Consumer Federation of California) is looking to start regulating cryptocurrencies, and it is doing so with a major swing.
As a major comeback move, it is sponsoring a bill that will focus on regulating the activities and licenses of the crypto company as a whole. Timothy Grayson, US Assembly Member was responsible for introducing the bill that the CFC is sponsoring.
Called the Digital Financial Assets Law, it is being put into place to protect individuals from financial hardships, while ensuring that crypto companies will be held responsible for the decisions that they make.
The most important thing that comes with these types of cryptocurrency companies is that innovation is essential to stay ahead of the competition. However, if there is no responsible innovation, then it is very likely that traders will not feel safe when they start trading.
What is the CFC?
The CFC is a major nonprofit advocacy group that specifically works for consumer rights, and ensures that individuals are protected in the event of them having to deal with crypto companies and the community at large.
The firm focuses on ensuring that they are safe from scams, and works on different types of legislation that can ensure a healthier trading environment for both the traders and the trading platform providers.
And in an effort to make trading even safer for all of its traders, the CFC is sponsoring a major piece of legislation that will not just regulate the entire industry, but it will also help with licensing concerns.
The Purpose of the Bill
The bill is a landmark piece of legislation in the state of California, as it is looking to improve regulatory oversight on crypto companies, which can in the long term help improve oversight of different companies, competition in the market, and protection of consumers.
Assemblymember Timothy Grayson introduced the bill, as he understood the unprecedented popularity of cryptocurrencies and how they hold equal chances of scams as they do of bringing about something of a financial revolution.
And to ensure that the latter does happen, he is looking to protect all Californians who are looking to get into cryptocurrencies but are more than likely to face the worst side of it firsthand.
In fact, Grayson said as much when talking to the press, saying that taking this step is a necessity to ensure that Californians are not vulnerable to preventable and yet prevalent scams throughout the market.
So even though many companies will actively benefit from this type of crypto regulation, it is obvious that the focus is on helping customers first and the companies later. If they are quick enough to implement this bill, they will be able to make the crypto trading space much safer for investors of all levels.
The SEC and the Broader Issue with Regulation
One of the biggest issues that come with the regulation in the US is that the SEC has nearly free reign to go about regulating the crypto industry the way it pleases.
The issue with that stance on regulation is that the SEC does not feel compelled in any way to declare what changes it will be made to regulation or when they will take place.
They have been known to introduce new policies without informing crypto companies first, and they have even started to regulate through enforcement, which includes taking companies to court over “illegal activities.”
Of course, the companies would have no idea that they were doing something illegal or that they were taking any real responsibility for it. And with a new regulatory force, this issue can be avoided.