According to reports, the Wall Street is preparing for a long wait for the approval of their already queued crypto products from federal authorities like the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
The US government had ended its longest administration shutdown on Jan.25, lasting well over a month, with many heaving a sigh of relief, but which in turn, will surely delay the approval and commissioning of some Wall Street proposals.
How Long Before Normality Is Restored?
Since the shutdown stalled many federal agencies, including SEC and CFTC, Wall Street executives are under the impression that any crypto asset related applications that would be reviewed, would be done after the clearing of a five week backlog.
SEC also issued a press release, announcing the resumption of normal operations. Jay Clayton, SEC’s chairman, said that the leaders of the regulator’s various branches were in consultation with the staff on how to climb back to maximum efficiency.
Another high ranking executive, Steve Ehrlich, COO of the Wall Street Blockchain Alliance, said that the country’s longest shutdown was bound to have “some repercussions for the space.”
He also noted that the government shutdown might be just temporarily suspended, with the Congress and US President Donald Trump, still at loggerheads on the issue of the Mexican Wall and a permanent budget.
Ehrlich added that if a desired result was not achieved between the two sides by Feb.15, it could result in another shutdown.
In talks with a news outlet, Ehrlich said:
“I can’t imagine any company trusting that the government will not be shut down again following the 21-day reprieve. Until there is more certainty that the government will not get shut down again in 21 days, federal regulators will focus their activities on serving the broadest segment of the population and addressing their highest priorities, which may not include crypto.”
With SEC operating well below its maximum staffing capacities, the workers made an incredible effort to keep up with their herculean workload but a month long shutdown would still add significantly to the agency’s backlog, said Vince Molinari, CEO of Templum Markets, a regulated token trading platform.
Wall Street Projects Already Delayed
The shutdown has put a dampener on the numerous crypto products “hoping” to be approved.
“Conversations that had been ongoing between startups and relevant regulators such as the SEC (including its newly created FinHUB) about business models and plans have likely lost critical momentum and will take time to recover.”
One such case was the withdrawal of the VanEck/SolidX bitcoin ETF proposal by Cboe last month, with VanEck CEO pointing at the government shutdown as the reason of this decision.
Ehrlich concluded by saying that any clarity on digital asset regulations would also likely to be delayed due to “the mountains of paperwork that officials will need to address.”