Author: Techub News Digest
Unlike the gradual warming of temperatures in recent days, the cryptocurrency market has been on a downward trend since Bitcoin broke below $90,000 on February 25. Around 10:50 today, Bitcoin even fell below the $80,000 mark, hitting a new low in nearly 3.5 months. Coingalss data shows that over the past 24 hours, the total liquidation amount across the network reached $728 million, of which about $621 million were long positions and about $107 million were short positions. In addition, according to Alternative.me data, although the cryptocurrency fear and greed index has rebounded somewhat from yesterday, it is still in a "extreme fear" state.
However, in this anxious market environment, the recent actions of the U.S. financial regulatory authorities suggest that their previously hardline attitude towards cryptocurrencies is softening, and the "icy" regulatory hostility of the previous administration is gradually melting away.
The Attitude of the New U.S. SEC
If the previous U.S. SEC under the leadership of Gary Gensler was full of hostility towards the cryptocurrency industry, the attitude of the new U.S. SEC can be described as actively embracing it. Since Gary Gensler officially stepped down on January 21, the new U.S. SEC, under the leadership of Acting Chairman Mark Uyeda, is working to change its image in people's minds.
In the past week, the U.S. SEC has successively ended its investigations and enforcement actions against OpenSea, Robinhood Crypto, Uniswap Labs, and Gemini, and has officially withdrawn its lawsuit against Coinbase and plans to withdraw its lawsuits against ConsenSys and MetaMask. In addition, Binance and the U.S. SEC jointly filed a motion earlier this month to suspend the litigation for 60 days, citing that the newly formed cryptocurrency working group may have an impact on the case, the first request for a suspension of cryptocurrency-related litigation since Mark Uyeda took over as Acting Chairman. Affected by this, the TRON Foundation and Justin Sun also jointly filed a motion with the U.S. SEC to suspend the litigation.
Furthermore, regarding the controversial Memecoin, the U.S. SEC has also changed its ambiguous attitude and issued clear guidance, stating that it "is not a security, but rather a collectible". The U.S. SEC believes that the trading of Memecoin does not involve the issuance and sale of securities as defined by federal securities laws. Therefore, individuals involved in the issuance and sale of Memecoin do not need to register their transactions with the Commission under the Securities Act of 1933, nor do they need to meet the registration exemption provisions of the Securities Act. Of course, the department also pointed out that the buyers or holders of Memecoin are not protected by federal securities laws.
Perhaps due to the objective situation of the recent market downturn, coupled with the proactive and frequent signals released by the U.S. SEC, people are beginning to observe its significant changes. In fact, since the establishment of the new U.S. SEC, various actions have never stopped.
The day after Gary Gensler officially resigned, Mark Uyeda announced the establishment of a special cryptocurrency working group led by Hester Peirce, "dedicated to developing a comprehensive and clear regulatory framework for cryptocurrency assets". On January 24, the U.S. SEC officially withdrew the cryptocurrency asset accounting standard SAB-121, which can be seen as the "first shot" of its comprehensive reform. Subsequently, the U.S. SEC began to reduce the size of its cryptocurrency enforcement department, transferring some lawyers and staff to other departments, and forming a new task force, announcing ten tasks such as examining the status of different types of cryptocurrency assets under securities laws and providing clear statements on whether to approve or not approve cryptocurrency ETFs. Next, we saw various news about the U.S. SEC's review of ETFs, such as publicly seeking comments on Grayscale's Litecoin ETF, accepting Grayscale's Solana ETF 19b-4 application, accepting Grayscale's XRP Trust conversion ETF application, and accepting Cboe BZX's 19b-4 application to add staking functionality for the 21Shares Ethereum ETF.
All of this foreshadows that the new SEC will present a completely different image.
Other Regulatory Developments Beyond the U.S. SEC
In addition to the U.S. SEC's proactive reforms in cryptocurrency regulation, other regulatory developments are also worth noting.
The U.S. House Ways and Means Committee recently passed a resolution to repeal the IRS "DeFi Broker Rule" by a vote of 26 to 16, which is a major boon for DeFi. It is worth noting that the resolution still needs to be passed by a majority in the House and Senate, and signed by the President, before it can take effect.
Furthermore, at the first hearing of the U.S. Senate Banking Digital Assets Subcommittee chaired by Cynthia Lummis, the legislative progress on stablecoins became the focus. Lummis emphasized that stablecoins will be the top priority for the subcommittee in the coming months, and "plans to develop a bipartisan legislative framework for stablecoins and their market structure within the next few months". Former CFTC Chairman Timothy Massad also suggested at the hearing that lawmakers should prioritize the legal framework for stablecoins and delay issues related to market structure. In addition, Virginia Democrat Mark Warner asked the subcommittee members to discuss the possibility of KYC processes for stablecoin users.
Meanwhile, more and more government agencies are accelerating their efforts to listen to the voices of the cryptocurrency industry. For example, U.S. Treasury Secretary Scott Bessent recently hired Galaxy Digital legal counsel Tyler Williams as a digital asset and blockchain technology policy advisor. And according to Michael Saylor's disclosure, he recently met with U.S. House Financial Services Committee Chairman French Hill and proposed a digital asset regulatory framework to him.
These initiatives from the government, regulatory agencies, and industry leaders all signify that the regulatory environment for the cryptocurrency field is gradually maturing. In this context, although the current market is experiencing a downturn, from a long-term perspective, the cryptocurrency market may usher in a healthier and more standardized development period.
Beyond Regulation, the Progress of State-Level Strategic Bitcoin Reserves
Unlike the direct regulatory benefits released by the U.S. SEC and various institutions, although the progress of the state-level strategic Bitcoin reserves has not been as smooth, it is still generally positive.
The "Bitcoin Laws" website established by Julian Fahrer shows that currently 24 states in the U.S. have proposed strategic Bitcoin reserve bills, with a total of 31 bills. Among them, the Bitcoin reserve bills in Montana, South Dakota, North Dakota, Pennsylvania, and Wyoming have been rejected or shelved. The state with the fastest progress is Utah, where the relevant bill has been submitted to the Senate. Next is Arizona, where the relevant bill has passed the third reading in the Senate with a vote of 17 in favor and 12 against, and is now being submitted to the House for consideration. Other states with relatively advanced progress include Oklahoma and Texas.
Although the progress of different states varies, the legislative progress of strategic Bitcoin reserves indicates that local governments attach importance to and are adopting cryptocurrencies. Although it is unknown how the Trump administration is currently preparing for this strategy, it may be more reasonable to not act hastily.
Summary
Although the market is facing violent price fluctuations and the spread of panic under the largest hacker crisis in history, it is hoped that the gradual improvement of the regulatory environment can, like the faint warmth of spring, gradually melt the past regulatory "ice" and inject new vitality into the market. As for the current downward trend, the author also suggests that everyone should wait and see for a while.
