The regulations that could result from the FSOC decision likely would be based on the regulations to which bank holding companies are subject and would be entirely unsuited to the regulation of other types of entities. The systemic risk statutory provisions were an example of the Dodd-Frank provisions that were adopted in the post-financial crisis burst of legislative exuberance. They are utterly impractical in actuality as applied to non-banks. See also, ;; .

The Hippocratic oath, "first do no harm," might have some relevance here. In the absence of an identified material problem, and in the face of opposition from both buy-side and sell-side, it is not easy to see the reason for the amendment. That, of course, leaves aside a fundamental question as to whether the amendment is consistent with the statute, a question that does not provide an easy "yes."  

FINRA has had this proposal under study for a considerable period and has been testing various reporting requirements. Some version of the rule likely will be adopted. Firms should consider this concept proposal and carefully review both the substantive and the reporting requirements.  

The testimony highlights the complexity of the issues involved in the development of the digital asset ecosystem, and underscores how delinquent the regulators have been to date in failing to meet the challenge. These are not issues that will be quickly resolved.