The United States risks ‘chilling‘ cryptocurrency regulations, industry warns Congress

<p>Six cryptocurrency executives will tell Congress on Wednesday to tread carefully when imposing new rules on digital assets – or risk driving activity underground or outside the United States.</p> <p>Ahead of a House Financial Services Committee hearing scheduled to begin at 10:00 a.m. EST, executives from some of the world's largest cryptocurrency companies indicated in prepared testimony that they will generally support clearer rules. However, they will emphasise that excessive restrictions would not stifle activity, but would simply push it out of reach of the United States.</p> <p>"Without tailored legislative solutions that are openly debated with public participation, the United States risks unnecessarily onerous and chilling laws and regulations," Alesia Haas, CEO of Coinbase Inc, warned in Tuesday's testimony. "This has the potential to effectively drive cryptocurrency activity underground or to offshore exchanges with lax or non-existent compliance programmes."</p> <p>The panel's testimony, which was published ahead of the hearing, sets the stage for what is expected to be a closely watched and high-stakes event, as US lawmakers publicly press cryptocurrency executives to defend their business and flesh out ideas for regulation.</p> <p>Several executives, on the other hand, argued for a softer approach.</p> <p>"There are numerous examples of US regulatory decisions driving legitimate activity offshore, thereby harming US investors, innovators, and workers," Bitfury CEO Brian Brooks explained. "There is a reason why crypto talent has shifted away from Silicon Valley, the birthplace of the original commercial Internet."</p> <p>The rapid growth of cryptocurrency, particularly "stablecoins," which are digital assets whose value is pegged to traditional currencies, has attracted regulators' attention, who fear they could jeopardise the financial system if not properly regulated. Certain policymakers, including Senator Elizabeth Warren and Securities and Exchange Commission Chairman Gary Gensler, are a