BitGo CEO Belshe Calls for Crypto Regulation After Galaxy Digital Settlement
2min read Mike Belshe, the CEO of BitGo, has publicly commented on the recent settlement between galaxy digital, led by Mike Novogratz, and the New York Attorney General (NYAG). Belshe, who has historically been a proponent of deregulation, has shifted his stance to advocate for regulatory intervention in the cryptocurrency industry. This change in perspective comes in response to what he perceives as unethical practices within the industry, particularly those highlighted in the NYAG's case against Galaxy Digital.
In a recent post on X, Belshe responded to a comment by Anthony Scaramucci, acknowledging the compelling case presented by the NYAG against Galaxy Digital. He specifically pointed out the firm's involvement in pump-and-dump schemes, where tokens are sold immediately after vesting and promoted to hold (HODL) while the sellers are actively offloading their holdings. Belshe emphasized that such actions are not only unethical but also detrimental to the industry's reputation. He expressed respect for Novogratz's contributions to the industry but firmly stated that Galaxy Digital's actions were unacceptable.
Belshe's call for regulation is rooted in the belief that without proper oversight, the industry will continue to face issues that could lead to over-regulation. He advocates for 'principles-based regulation,' which would prevent industry leaders from lying to promote assets they hold or from advising others to buy while secretly selling. This approach aims to ensure transparency and ethical behavior within the cryptocurrency space.
The settlement between Galaxy Digital and the NYAG, which involved a significant financial penalty, has underscored the need for regulatory frameworks. Belshe's comments come at a time when the industry is experiencing a shift in regulatory attitudes. The US Securities and Exchange Commission (SEC), under the leadership of Acting Chair Mark Uyeda, has established a Crypto task Force to develop guidelines for the industry. This move indicates a more proactive approach to regulating the cryptocurrency sector, which could help prevent future unethical practices.
Belshe's advocacy for regulation is part of a broader trend within the industry. While some leaders have traditionally opposed regulation, the recent actions by regulatory bodies suggest a growing acceptance of the need for oversight. The Federal Deposit Insurance Corporation (FDIC) has advised federal banks that they do not require prior approval to engage with the cryptocurrency industry, which has encouraged greater adoption of digital currencies. Additionally, major financial institutions like fidelity Investments have launched stablecoins on public blockchains, further integrating cryptocurrencies into the mainstream financial system.
In conclusion, Mike Belshe's call for regulation in the wake of Galaxy Digital's settlement with the NYAG highlights the industry's evolving stance on oversight. As regulatory bodies become more involved, the cryptocurrency sector is likely to see increased transparency and ethical behavior, which could ultimately benefit its long-term growth and acceptance.
