U.S. can regulate cryptocurrencies without new law, think tank says

U.S. regulators can largely use existing laws to bring digital assets such as cryptocurrencies under their supervision without new congressional legislation, one of Washington’s most influential liberal think tanks said on Tuesday.

Agencies including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) could use the report from the Center for American Progress (CAP) to inform their decisions on how to govern cryptocurrencies.

Regulators have not yet determined how best to regulate cryptocurrencies, in particular so-called “stablecoins” whose creators say they have pegged their values to the dollar and other fiat currencies. The U.S. Treasury Department kicked the issue to Congress in a report last year.

Progressives, worried about systemic risk and investor protection, want regulators to take a tougher stance on the issue.

The think tank said it would be helpful for Congress to address gaps within the current regulatory framework — such as creating rules for crypto commodities. But it warned that a new and distinct regulatory structure for crypto could inadvertently weaken supervision and create regulatory arbitrage.