US crypto regulation is seen as a potential boost for market participation, according to various stakeholders.

In a significant shift for the crypto industry, major players such as JPMorgan Chase and PayPal are launching their own stablecoins, signalling a growing acceptance of digital assets.

JPMorgan Chase operates its own blockchain network, Onyx, and a private stablecoin, JPM Coin. Similarly, PayPal plans to launch a U.S. dollar stablecoin for payments and transfers on its peer-to-peer app Venmo. This move is expected to reduce payments friction in virtual environments and generally bolster the use of digital assets.

Lindsey Argalas, CEO of TaxBit, views this entry of large, responsible, and heavily regulated players like PayPal and JPMorgan into the stablecoin space as a significant milestone and a good thing for the industry. She believes that regulatory clarity in the U.S. would help the crypto space roll out products and services beneficial to consumers.

The U.S. Congress is also taking steps towards providing this regulatory clarity. The Financial Innovation and Technology for the 21st Century Act and the Clarity for Payment Stablecoins Act of 2023 have moved out of their respective committees this summer. These bills, if passed, would provide a clear regulatory framework for stablecoins, helping the industry to scale its digital asset products.

Warren, CEO of the Crypto Council for Innovation, believes the passage of these bills would signal that the United States is open for business in the crypto industry and has a competitive regulatory regime. She stated that many crypto firms managed to survive the fallout from FTX's collapse, demonstrating consumer interest in their services.

Despite the lingering chill tied to the downfall of FTX and others in the digital asset world, Sheila Warren described the past year as a "building year" for crypto in the U.S. Lawmakers have responded positively to the crypto industry's efforts to differentiate itself from FTX, according to Behuniak, a staff director on the House Financial Services Committee's subcommittee on digital asset.

The fact that multiple crypto bills have been introduced in the wake of FTX's collapse showcases that lawmakers believe the space will rebound, and that interest remains in the promise of digital assets. Other international jurisdictions, such as the EU, Singapore, Hong Kong, the Middle East, and the UK, are also moving quickly with their own crypto regulations.

However, Argalas also emphasized the importance of getting legislation and regulatory clarity in place to accommodate the increased stakes and volume associated with these large players. The entry of such players into the stablecoin space could potentially increase the stakes significantly, making clear regulations essential.

The ongoing implosion of FTX founder Sam Bankman-Fried was described by Warren as a significant setback for the crypto space. Nevertheless, the industry has made efforts to distance itself from such bad actors, demonstrating a maturing of the industry and a commitment to transparency and accountability.

In conclusion, the entry of major players like PayPal and JPMorgan into the stablecoin space, coupled with the progress made in U.S. regulatory clarity, indicates a promising future for the crypto industry. The industry is building, learning, and adapting, and with the right regulatory framework in place, it is well-positioned to scale its digital asset products and services.

US crypto regulation is seen as a potential boost for market participation, according to various stakeholders.