What Biden’s Administration Means for US Crypto Regulation

Markets Dec 08, 2020

We’re extremely proud to announce that Carla Carriveau has joined CoinList as our new Chief Legal Officer and General Counsel. Carla comes to CoinList from Forge, an innovator for private markets, and previously spent nearly 20 years as a regulator with FINRA and the SEC, serving in a number of leadership positions including as Executive Staff to SEC Chair Mary Jo White. At CoinList, Carla will oversee all aspects of the business as we continue to help the world’s most impactful crypto projects grow and succeed. We hope you enjoy her first post on CoinList below:


In significant contrast to years past, 2020 has seen positive regulatory initiatives in the U.S. related to the crypto ecosystem. The federal government’s interest and recognition signals a shifting attitude towards the legitimacy of cryptocurrency.  Several federal and state agencies have shifted focus towards innovation and exploration in understanding blockchain technology.  A few notable standouts:

  • The Office of the Comptroller of the Currency permitted federally regulated banks to provide custody services for crypto thereby eliminating the industry’s need to navigate a patchwork of state trust regulations.
  • Square’s admission as a PPP loan provider facilitating distributions through its CashApp crypto product reflected an acceptance of crypto players as partners with the US government and signaled that crypto could be a needed facilitator of relief in times of distress.
  • The Federal Reserve Bank of  Boston, heeding a call from Governor Brainard to advance thinking on a central bank digital currency, has been at the forefront of researching the technology upon which cryptocurrency is built, even partnering with MIT to do so.

State regulators too have done their part to advance this nascent industry in 2020.

  • Wyoming led the charge by, among other things, permitting two crypto companies to become state-chartered banks via a newly created vehicle, the Special Purpose Depositary Institution.
  • State banking divisions across 40+ states are simplifying compliance for cryptocurrency companies by consolidating supervisory examinations of money transmitters.

Nonetheless, we must recognize that no jurisdiction has driven more enforcement than the United States. A report from the Columbia Law School illustrates this point, noting that the Securities and Exchange Commission has brought more enforcement actions with more serious penalties than did regulators in other major jurisdictions combined. The Commodity Futures Trading Commission too has begun ramping up crypto-enforcement, including the recent enforcement actions against BitMex. Similarly, legislators and the executive branch have started to take notice, including the recently proposed STABLE Act.

So what can we expect in 2021 and beyond?

What’s Ahead?

1. More enforcement actions:  The SEC is unlikely to stand down in this space under a Democrat administration, and we expect to see more actions against intermediaries, the gatekeepers directly regulated by the SEC.  The CFTC for its part seems to have gained focus on its crypto enforcement goals and appears to be exploring how far it can push its jurisdiction in the spot commodity market.  The success of DeFi will likely make its way to the top of the SEC and CFTC’s list of hot topics to pursue.

2. More regulation:  The Financial Crimes Enforcement Network (FinCEN), a bureau of the Treasury Department, and the Federal Reserve Board have proposed amendments to anti-money laundering regulations that would lower the applicable threshold for reporting from $3,000 to $250 for international transactions.  Though unconfirmed, the Treasury Department also purports to be considering requiring institutions to verify the identity of self-hosted wallet owners.  Compliance with these new regulations would be costly and perhaps even impossible.  Look for more on this front.

3. More legislation: With no clear regulatory scheme for crypto, we don’t expect legislative efforts to significantly curtail agencies’ efforts.  Forbes’s tally of bills  introduced in this Congress found 40 on the subject of cryptocurrencies and blockchain; however, only two have become law and neither impacted regulation significantly.  We anticipate a similar cadence in the next Congress.

Of course, none of this is surprising for CoinList users who are accustomed to these constant battles, trying to make regulatory schemes adapt to fit this new technology.

Progress on the Horizon

Still, the Biden transition could provide some balance to overly aggressive enforcement efforts, particularly because Gary Gensler, a former CFTC Chairman and blockchain champion, is leading the financial policy transition team.  Agencies to watch:

  • Treasury: Janet Yellen has been selected to serve as Secretary.  Her predecessor,  Steve Mnunchin, has been pushing for limitations on crypto so we’re hopeful that she will take a lighter approach .
  • Office of the Comptroller of the Currency: Brian Brooks has been an amazing ally as Acting Comptroller of the OCC. Sadly, we do not expect his nomination to be heard at the Senate Committee level.  Insiders are floating the names of a CA government official known to be an innovator and a former OCC staffer as replacements.
  • Federal Reserve Board: Governor Brainard has been a proponent of innovation in the banking industry and has been pushing the Feds to explore a CBDC.  Her term expires January 2026; however, she is being considered for a position in the administration possibly opening up her spot at the Board.
  • Securities and Exchange Commission:  Jay Clayton hasn’t been a friend to our industry so we’re hopeful that any change is a good one.  The front runners appear to be Gary Gensler, Kara Stein, a former Commissioner, and Annette Nazareth, also a former Commissioner who has represented a number of crypto industry participants as well as The Blockchain Association.
  • Commodity Futures Trading Commission: Insiders anticipate that  one of the current Commissioners will be named to lead the agency.

For CoinList customers—the projects, issuers, investors, traders, and market-makers who make up this ecosystem—the regulatory impacts of operating in the U.S. remain challenging.  Still, 2021 is positioned to see more breakthroughs in U.S. regulatory schemes allowing good actors in the crypto industry to advance products and services like never before.  CoinList looks forward to working with regulators and other industry members in creating a framework that will better serve the U.S. crypto market.


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