WASHINGTON: Jolted by the global investment craze over bitcoin and other cryptocurrencies, US lawmakers are moving to consider new rules that could impose stricter federal oversight on the emerging asset class, several top lawmakers told Reuters.
Bipartisan momentum is growing in the Senate and House of Representatives for action to address the risks posed by virtual currencies to investors and the financial system, they said.
Even free-market Republican conservatives, normally wary of government red tape, said regulation could be needed if cryptocurrencies threaten the US economy.
“There’s no question about the fact that there is a need for a regulatory framework,” said Republican Senator Mike Rounds, a Senate Banking Committee member.
Digital assets currently fall into a jurisdictional gray area between the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Treasury Department, the Federal Reserve and individual states.
Much of the concern on Capitol Hill is focused on speculative trading and investing in cryptocurrencies, leading some lawmakers to push for digital assets to be regulated as securities and subject to the SEC’s investor protection rules.
“The SEC is properly the lead on the issue,” said Republican Representative Bill Huizenga, chairman of the House Financial Services Subcommittee on Capital Markets which will hold hearings on the issue in coming weeks.
Huizenga said the recent growth of the virtual currency market had made him more comfortable with more oversight. “Six months ago, we didn’t see this explosion. The marketplace has changed,” he said.
Carolyn Maloney, a Democratic senior member of the House Financial Services Committee, is another lawmaker advocating for direct oversight of digital assets by the SEC.
“A lot of people don’t realize there’s nothing backing these virtual currencies,” she said.
Virtual currencies have existed for years but speculation in them has recently ballooned, along with scams promising investors returns of over 1,000 percent in weeks.
In a time of volatile markets, hackers are also active in the sector, stealing $530 million of digital currency from Japanese exchange Coincheck last month.
Bitcoin, the best known virtual currency, lost over half its value earlier this year after surging more than 1,300 percent.
“We have to look carefully at all of the cryptocurrencies and make sure individuals don’t get taken advantage of,” said Representative Tom MacArthur, a House Financial Services Committee Republican.
Regulators globally have raised the alarm over cryptocurrencies, saying they may aid money laundering and terrorist financing, hurt consumers and undermine trust in the global financial system.
France and Germany want cryptocurrencies on the agenda for the upcoming G20 meeting of the largest advanced and developing economies.
Conservative Republicans also recognize the potential for broader risks.
“I’m a total free-marketer, so I don’t want to regulate,” said Republican Representative Dave Brat, a member of the conservative House Freedom Caucus.
“But if it’s a currency that could destabilize the whole economy, you’re going to have that conversation,” he said.
The SEC and CFTC chairmen recently called for greater scrutiny of digital assets before the Senate Banking Committee. Members of the panel said the regulators will return to discuss how to move forward.
While many lawmakers agree tighter oversight is needed, there is no consensus yet in Congress on how to proceed.
While some lawmakers say speculative investments should be classed as securities, others want digital currency transactions regulated as commodities.
The SEC is already cracking down on transactions known as initial coin offerings (ICOs), while the CFTC has identified digital assets as a commodity subject to its anti-fraud rules.
US Congress sets sights on federal cryptocurrency rules
US Congress sets sights on federal cryptocurrency rules
SABIC sells European petrochemicals, engineering plastics units in $950m portfolio restructuring
RIYADH: Saudi Basic Industries Corp. is selling two overseas businesses for a combined $950 million as the world’s biggest petrochemicals maker continues to streamline its portfolio and redeploy capital toward higher-return segments.
The Riyadh-based company agreed to sell its European petrochemicals business to investment firm AEQUITA for $500 million and its engineering thermoplastics operations in the Americas and Europe to turnaround specialist Mutares for $450 million, SABIC said in a release.
The plastics deal includes an earn-out linked to future cash flow and a potential resale.
The transactions are part of SABIC’s portfolio optimization program launched in 2022, which has already seen divestments including Functional Forms, Hadeed and Alba. The company aims to sharpen its focus, improve returns, and free up capital for higher-growth opportunities.
Abdulrahman Al-Fageeh, CEO of SABIC, said: “This strategic approach allows us to actively reshape our portfolio and sharpen our focus on areas where SABIC has clear and sustainable competitive advantages in a rapidly changing landscape.”
He added: “I am pleased that both AEQUITA and Mutares will work with us in the future to ensure that we continue to serve our global customers in a seamless manner.”
The European petrochemicals business produces ethylene, propylene, various grades of polyethylene, polypropylene and polymer compounds. Its manufacturing footprint includes sites in the UK, the Netherlands, Germany and Belgium.
The engineering thermoplastics business in the Americas and Europe produces polycarbonate, polybutylene terephthalate and acrylonitrile butadiene styrene. Its facilities are located in the US, Mexico, Brazil, Spain and the Netherlands.
“The Board endeavored to achieve these transactions, which represent a significant milestone in the execution of our strategy to further optimize our portfolio and maximize shareholder value by enhancing the Company’s cash generation capacity and achieving the highest possible return on our global businesses,” said Khalid Al-Dabbagh, chairman of the board of directors of SABIC.
Chief Financial Officer Salah Al-Hareky said the transactions demonstrate a “disciplined approach” to capital allocation and active portfolio management, aimed at improving return on capital employed and free cash flow.
Despite the divestments, SABIC said it will maintain strategic market access through exports to Europe and the Americas, while preserving its focus on technology, innovation and customer service.
Both buyers have committed to ensuring business continuity, retaining workforce expertise and maintaining high safety and customer service standards during the transition.
Axel Geuer, president and co-CEO of AEQUITA, said: “This transaction represents a further step in the expansion of our European chemicals platform.”
He added: “The assets are highly synergistic with the olefins and polyolefins business we recently acquired from LYB; with complementary markets, infrastructure and operational capabilities, we see substantial potential to realize synergies and drive operational improvements across both businesses.”
Geuer, noted that under AEQUITA’s active ownership model, the focus will be on supporting the teams on the ground, ensuring a seamless integration, and building a scaled, competitive platform positioned for long-term, sustainable value creation.
Robin Laik, co-founder and CEO of MUTARES, said: “The Engineering Thermoplastics (ETP) business in the Americas and Europe has a highly skilled workforce and strong customer relationships.”
He added: “Under focused ownership, our priority is to ensure continuity, support employees through the transition, and unlock the full potential of our asset base as a standalone ETP platform.”
The deals are subject to customary closing conditions, regulatory approvals, and, where applicable, employee consultation processes.
