The world economic system got a new direction with cryptocurrency, but there is a problem with the uncertainty of the rules. In the United States, the Clarity Act emerged as an attempt to resolve this dilemma.
Until now, the biggest question along with cryptocurrencies in the USA has been who will regulate them? Are these securities or commodities? Because of this confusion, many crypto companies are suddenly facing legal action. The Clarity Act claims to clear this uncertainty. This law attempts to determine which crypto assets will fall under the role of the SEC and which will fall under the CFTC.
According to this act, if a crypto asset is completely decentralized and not controlled by any single entity, it will be considered a commodity. On the other hand, tokens in which a company or group plays a decisive role will fall into the category of securities. On the other hand, tokens in which a company or group plays a clear role will fall into the category of securities. This will not only provide companies with clarity on the regulations, but it could also boost investor confidence.
However, there are also concerns regarding the Clarity Act. Critics believe that this law could weaken investor protection and grant unfair concessions to large cryptocurrency companies. Some experts fear that this will limit the power of regulatory agencies. Some experts fear that this will limit the power of regulatory agencies.
Still, it is true that no emerging sector can remain stable without clear regulations. The Clarity Act at least attempts to establish rules in advance rather than imposing punishments later.
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