Fourteen years after the Genesis block of bitcoin triggered profound disruptions in financial services and other industries through the rise of blockchain technology, United States authorities are finally becoming more interested in the future and economic impact of cryptocurrencies.
On December 14, the Financial Accounting Standards Board (FASB) discussed new accounting and disclosure requirements for entities holding crypto assets in financial statements, after consulting investors on the agenda — the first in five years. The proposed rules are expected to be published in the first half of 2023.
A few days earlier, the Securities and Exchange Commission (SEC) provided a sample letter regarding recent developments in crypto markets, asking companies to consider in their disclosures “the need to generally address crypto asset market developments in their filings, including and their business descriptions, risk factors and management’s discussion and analysis.”
Related: The world of crypto regulation: How digital asset laws will change in 2022
The changes will be felt by many players in the crypto and financial services industry, according to legal experts. “It should have multiple and ultimately profound macro and micro impacts on financial markets in general and the crypto industry in particular,” Mark Kornfeld, securities and financial fraud partner at law firm Buchanan Ingersol and Rooney, told Cointelegraph. According to the lawyer:
“First, the Commission, much like it did after the Madoff Ponzi scheme was revealed to the world, will aggressively monitor and conduct full regulatory examinations of the thousands (if not more) operating in and around this space. Everyone in the market should reasonably anticipate and fully expect a significant increase in procedures for the implementation of regulations by the Commission and, ongoing legal challenges, to the competent body of the Commission.”
Cryptocurrency is also reportedly becoming a focus of the Internal Revenue Service (IRS), with its criminal investigation division hiring hundreds of new agents to work on digital assets and cybercrime. Along with its own data scientists, the IRS hopes to work with crypto companies, with the goal of creating a “symbiotic relationship” in the fight against financial crime.
Lawmakers in the United States are also under pressure to set up a new regulatory framework for cryptocurrencies following the dramatic collapse of crypto exchange FTX last November, setting the stage for upcoming crypto market controls in 2023.
There are, however, those who believe that the outcomes will be positive in the long run. “The end result should be a more orderly and transparent climate, increased market stability and significantly improved protection of investors and consumers in a space that until recently operated in a rather secretive and opaque environment,” said Kornfeld.