Crypto Friendly Senators Present A New Cryptocurrency Bill In The USA! Here is the Content
Senators Cynthia Lummis and Kirsten Gillibrand have introduced a comprehensive bill aimed at regulating the cryptocurrency space in the United States. The bill, titled "The Digital Asset Market Structure and Investor Protection Act of 2023," is an updated version of a previous bill proposed by the senators. Its main objectives are to provide clarity and certainty for crypto investors, innovators, and regulators, protect consumers, and promote fair competition in the Bitcoin and crypto market. Here are the key points of the bill:
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Clarifying Asset Classification: The bill establishes that crypto assets lacking financial interest in the underlying project will be considered commodities rather than securities. Consequently, such tokens will fall under the regulatory oversight of the Commodity Futures Trading Commission (CFTC) instead of the Securities and Exchange Commission (SEC).
Regulating Crypto Exchanges: The bill assigns the responsibility of regulating crypto exchanges, including popular platforms like Coinbase, to the CFTC, not the SEC. It mandates that crypto exchanges register with the CFTC and comply with their rules and regulations. This includes implementing robust client protections such as segregating client funds and regularly reporting proof of reserve.
Stablecoin Issuance and Oversight: The bill permits regulated depository institutions, such as banks or credit unions, to issue stablecoins. It also requires stablecoins to be fully backed, maintaining a 1:1 ratio with high-quality liquid assets like cash or government bonds. Existing stablecoin issuers would receive priority in obtaining new licenses from the Office of the Currency Controller (OCC), which oversees national banks.
The sponsors of the bill assert that it would establish a clear and consistent regulatory framework for cryptocurrencies in the United States. They argue that the current regulatory landscape is fragmented and lacks clarity. Additionally, they believe that the bill will foster innovation and growth in the crypto industry while safeguarding investors and consumers against fraudulent activities and manipulation.
Although the bill's passage in the current term seems uncertain due to conflicting priorities within the divided Congress and the Biden administration, it is currently supporting crypto exchanges in their advocacy against SEC sanctions lawsuits. The bill reinforces that it is Congress, not the SEC, that holds the authority to determine the regulatory approach for cryptocurrencies.
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