The Senate Banking Committee plans to hold a hearing on Feb. 6 to examine the Securities and Exchange Commission and Commodity Futures Trading Commission’s roles in overseeing virtual currencies.

SEC Chairman Jay Clayton and CFTC Chairman J. Christopher Giancario stated in a Jan. 25 joint Wall Street Journal op-ed that both regulators are tasked with setting and enforcing rules “that foster innovation while promoting market integrity and confidence.”

In recent months, the two wrote, the SEC and CFTC “have seen a wide range of market participants, including retail investors, seeking to invest in DLT [distributed ledger technology] initiatives, including through cryptocurrencies and so-called ICOs — initial coin offerings.”

They added: “Experience tells us that while some market participants may make fortunes, the risks to all investors are high. Caution is merited.”

Market regulators are reassessing “whether our historic approach to the regulation of currency transactions is appropriate for the cryptocurrency markets,” wrote Clayton and Giancario. “Check-cashing and money-transmission services that operate in the U.S. are primarily state-regulated. Many of the internet-based cryptocurrency trading platforms have registered as payment services and are not subject to direct oversight by the SEC or the CFTC. We would support policy efforts to revisit these frameworks and ensure they are effective and efficient for the digital era.”

Clayton recently warned attorneys that the agency’s staff is “on high alert” for approaches to ICOs that “may be contrary to the spirit of our securities laws and the professional obligations of the U.S. securities bar.”

— Check out Shining a Light on Bitcoin on ThinkAdvisor.