Trump Stopped U.S. Government Shutdown, but the Damage It Did to Cryptocurrency Adoption Is Here to Stay

On January 25, President of the United States Donald Trump put an end to the partial closure of the government, albeit temporary. As a result of the financing agreement signed Friday, the government will be open for three weeks.

Although the future is still unclear for US government facilities, returning to work after the 35-day Tramp-Senate crisis, it is time to reconsider how regulators such as the Securities and Securities Commission (SEC) and the Commodity Futures Trading Commission (CFTC ) were affected and what this meant for the cryptographic market.

 Trump failed to get money for its border wall, shut down the US government

The closure was triggered by $ 5.7 billion in federal funding to build the US-Mexican Border Wall, which Trump demanded during his 2016 presidential campaign, one of the promises of his signature.

Initially, Trump claimed that he would recover the costs of the Mexican Wall, but Enrique Pena Nieto's chairman refused to finance the construction. As a result, in January 2017, the Trump Administration signed Decree 13767, which officially ordered the US government to build a wall using existing federal funds.

In December 2018, the Senate, who was under the control of the Republican Party, unanimously adopted the bill without funds. After that, Trump said he would not sign any financing law that does not include money for the established border. According to Politics reports, Trump's decision could have been influenced by conservative and ultimately right-wing media, which, as reported, pressured the president to keep his long-term promises.

Domestic Republicans then voted 217-185 in favour of the bill on wall financing but did not find enough support in the Senate.

In what culminates in the clash that preceded the closing of the market on December 11, Trump met with newly-elected President Nancy Pelosi and Chancellor of the Senate Minority Chuck Schumer to request $ 5.7 billion to fund the wall. After rejecting his proposal, Trump said, "I'm proud to close the border government ... I'll do it; I will not blame you." [.] .. I'll take a coat. Ten days later, Trump went to Twitter to blame the Democrats for this closure.



As a result, closure began on December 22, while funds for many agencies, homeland security, law enforcement, tax collection and transportation expired. Approximately 800,000 civil servants were released or forced to work without a salary. Closing would affect a quarter of the government. According to Standard & Poor's analysis, January 11, the closure of the US economy cost $ 3.6 billion. Given that it lasted for another 14 days and became the longest closing of the government in US history, the overall impact could be even greater.

SEC has been largely paralysed, postponing its stock market applications, and possibly triggering trading by preferential information

On December 27, DIP announced that it would work with reduced power during the closure.

"Starting from Thursday, December 27 and further, the agency will have a very limited number of available staff," the regulator said on its website. The DIP has added that it will retain the necessary staff to respond to emergencies involving market integrity and investor protection.

Also, the regulator has maintained the activities of its Investor Implementation and Complaints Bureau, as well as an Electronic Data Acquisition, Analysis and Recovery System (EDGAR) for disclosing information from investors. Companies.

According to the Quartz Enigma Technologies Intelligence Agency, DIP worked at 5.8% of its normal capacity during the closure, while a division of the division was 8%.

In Quartz commentary, John Stark, former SEC's Internet boss, called the figures "shocking" and predicted increased trading by privileged information during the closure:

"There will be absolutely some people on Wall Street outside Wall Street, who think they can get away with something because the cop is just not there."

Also, Stark pointed out that DIP was too low even before the market was closed, which could make the Watchdog's market monitoring difficult. It may take months to resolve the backlog, he explained, since the DIP enforcement staff would not even be allowed to read their e-mails. "Even if they want to work from home and at work, it's illegal to do that," added a former DIP employee.

Another former SEC employee, former accountant and examiner, Tim Dunn, told Quartz that "the most basic" SEC staff remained in the office of a senior executive. As a result, it is unlikely to look at the cases, he explained.

"How far are they from practising these important cases and are they working on them?" [...] The senior manager probably did not do that job for six, eight, or ten years. "



The decision could encourage market players to commit a breach, says James Cox, a law professor at Duke University, who was also interviewed by Quartz. Cox pointed out that trading by privileged information is one of the main examples of such criminal offences, claiming he makes 10% of all executions. He argued that DIP had been forced to settle outstanding cases due to the lack of employees at work, which the market could take advantage of:

"They send a message to people on Wall Street:" Hey, maybe less likely to be captured now, "and has all sorts of perverse incentives."

On 27 January 2019, following the temporary closure of the closure, the SEC issued transitional instructions explaining how the staff would handle the remaining transactions and returns as well as the shareholders' proposals that accrued during the final period closure.

According to the guidelines, staff will give priority to submissions, submissions and requests for action, including shareholders' proposals. Newspapers also warn that DIP response time is longer than usual.

According to the transactions, the initial IPO market has been hit hard. Namely, requests from companies wishing to become public in the first quarter of 2019 have been postponed. On the list of these companies is Canaan, the second largest Chinese mining equipment manufacturer for Bitcoin, who turned to New York after the Hong Kong Stock Exchange (HKEX) cancelled plans for $ 400 million. ).

CFTC's activity was also halted, postponing review of ETH platform and digital asset applications


CFTC, the agency that oversees the derivative market and trading Bitcoin's future, is also largely closed. On 18 December, the Agency issued a letter announcing that it would "seriously reduce its business". According to the statement, only 9.1% of TCRC staff remained at work during the closure period.

However, the regulator has requested a suspension of anti-binary options and fraudulent virtual currency. On December 26, he allegedly filed separate requests to federal courts.

A case in which CFTC wanted to continue the investigation allegedly introduced some companies accused of encouraging potential buyers to buy illegal binary exchange options via companies such as Blue Bit Banc. The defendants were trying to conceal their offence by asking customers to transfer funds from their binary ATM accounts.

The closure could also extend CFTH Ethereum (ETH) studies for an indefinite period.

On December 11, the supervisor asked the public to comment on the Ethereum chain to better understand the differences and similarities between ETH and Semantic Bitcoin Cryptocurrency (BTC). According to the Roll Coll report, although the commenting period does not end until mid-February, no TCRC staff members were set up to start reviewing.

Also, the ErisX currency crisis, which raised $ 27.5 million from major investors in December, was also hit by foreclosure. TCRC must approve the platform because it is designed to meet the needs of the ticker market. Its application is probably delayed.

Similarly, the Bakkat Digital Property Platform, overseen by the Intercontinental Exchange (ICE), is likely to experience a further delay due to a major failure. According to the company's official announcement, "After consulting with the Commodity Futures Trading Commission, ICE Futures US Inc. plans to provide an updated launch schedule for trading, clearing and storage contracts in early 2019." Bitcoin term Bakkt.

On 28 January CFTC President J. Christopher Giancarlo announced the return of agency activities. In its statement, however, he noted that CFTC "continued to perform essential market functions during the termination period".

"The Agency was well prepared and used the" Credit Abolition "action plan adopted a year ago. The small team of the Agency staff continued to monitor derivative markets and ensure that key control activities are completed."

The demolition could come back, causing even greater damage

Despite all the consequences, Trump reiterated his allegations about the US-Mexican Wall Fund, which he temporarily interrupted the closure. Financial Times quoted him as saying:

"If we do not get a fair solution from the Congress, the government will resume on February 15, and I will use the power I am legislating and the United States Constitution to address in this urgent case, and we will have great security."

As a result, the impact on the cryptocurrency industry, in particular, its progress on Wall Street, could be further delayed. Given that various Bitcoin ETF applications have been delayed several times by the DIP and that the regulator faces significant backlogs caused by the closure of other tasks, the adoption of the crypt could be significantly delayed,

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