The United States Department of Justice recently filed a court motion suggesting that the lack of cryptocurrency regulation in the US should not hinder the criminal charges lodged against Sam Bankman-Fried, former CEO of the now insolvent crypto exchange, FTX. In response to a request for clarification, the DoJ dismissed arguments made by Bankman-Fried’s legal team that their client could not be guilty since FTX was not regulated within US jurisdiction.
Seeking to put a rest to the idea that the existence of comprehensive legislation is a prerequisite to prove a legal obligation, the DoJ emphasized that the absence of such legislation does not undermine assertions that a defendant’s victims had invested money with them. The letter further highlights that defendants should not cultivate false impressions regarding the absence of regulations pertaining to the use of customer funds, reminding that there are prevailing regulations against this.
Furthermore, the DoJ specified that existing laws inhibit companies from misappropriating customer assets, and Bankman-Fried’s charges are laid under this category. Arguably, this underlines one of the reticent imbalances in crypto regulation, wherein existing laws can be hastily applied to novel situations often resulting in potentially harsh consequences. On the other hand, the existence of such a stop-gap mechanism adds some degree of protection against cases of asset misappropriation – a common worry in crypto trading circles.
In a separate but related matter, delegates from the French central bank, Banque de France, have highlighted the potential of Central Bank Digital Currency (CBDC) as the foundation for a fresh international monetary system. Denis Beau, the first deputy governor at Banque de France, portrayed CBDC as the catalyst for improving cross-border payments through the formation of a novel international monetary system. This perspective further solidifies the fundamental duality at the heart of blockchain, where it can either be seen as a disruptive force or a transformative opportunity.
As blockchain technology edges towards mainstream acceptance, debates like these will undoubtedly rage on. Despite the varying camps, the pressure for regulatory bodies to take a firm stance on defining the digital space continues, even if it means leaning into uncharted territories and unrecognizable territories. This may, at the very least, pave the path towards a delicately balanced space where innovation is encouraged, and consumer protection is not undermined.
Source: Cointelegraph
