As the U.S. Securities and Exchange Commission (SEC) intensifies its regulatory efforts on the cryptocurrency industry, a particular legal principle, the major questions doctrine, is gaining notable attention. According to Kraken‘s Chief Legal Officer, Marco Santori, this doctrine could potentially diminish the authority of the SEC.
The major questions doctrine is a concept in U.S. administrative law that asserts federal agencies should not supersede Congress in addressing issues of substantial economic importance. Interestingly, Coinbase referenced the same doctrine in its preemptive defense against a pending SEC action. Santori believes this principle is particularly relevant as lawmakers commence deliberations on cryptocurrency regulations.
He explained that Congress’s active involvement in the matter and the bipartisan interest shown by representatives are key indicators that a significant question is at stake. Santori opined that a court could view the SEC as overstepping its mandate from Congress and determine that such a major question should ultimately be addressed by the legislative branch.
Kraken’s top legal executive emphasized that the SEC and the Commodity Futures Trading Commission (CFTC) must be aware of and consider the doctrine’s implications. Santori, who was among the witnesses at a recent joint hearing of the House Financial Services Committee and the House Agriculture Committee, expressed optimism that most lawmakers from both parties think legislation is necessary for cryptocurrency oversight.
However, one concern that remains is the uncertainty of the Senate’s stance on this issue, which raises questions about its potential outcomes. While the major questions doctrine offers a fascinating perspective on regulatory power, is it possible that it might indeed impact the SEC’s authority over the cryptocurrency sector? On the one hand, granting Congress the power to address significant economic questions may ensure a more comprehensive and balanced approach to regulating the rapidly evolving industry. On the other hand, asserting that the major questions doctrine applies in this situation could result in regulatory delays, which might impede the industry’s progress and create uncertainty for its participants.
In conclusion, the application of the major questions doctrine could significantly shape the future of cryptocurrency regulations in the United States. As Congress continues to examine the matter, it remains to be seen whether the SEC’s jurisdiction will be affected by this legal principle, and what the potential implications on the industry will be. While this debate unfolds, the importance of striking the right balance between fostering innovation and ensuring safety for investors cannot be stressed enough. Only time will tell how the US government ultimately navigates the complex world of cryptocurrency regulation.
Source: Coindesk
