The future of digital assets remains uncertain due to a lack of clarity from regulatory authorities. As such, it would be beneficial if Congress took the initiative to weigh in on the situation, with representatives from both sides of the aisle introducing bills that provide “regulatory clarity.” Specifically, two Senate bills have been put forward in hopes of providing more insight into the regulatory standing of cryptocurrencies.
The Boozman-Stabenow Bill
Democratic Senate Agriculture Committee Chair Debbie Stabenow and Republican Sen. John Boozman have teamed up to write a proposal that could be taken up by the committee as soon as next calendar year. The bill has earned broad bipartisan support and would give the Commodity Futures Trading Commission (CFTC) authority to regulate cryptocurrencies. Democratic Senator Cory Booker and Republican Senator John Thune have also signed on in support of the bill, which would require all crypto trading platforms to register with the CFTC.
Related: Whales and Regulators Causing Havoc in Digital Currency Group
However, cryptocurrency experts have voiced one consistent criticism: the bill does not provide a precise definition of what constitutes commodities and securities. Without clarification, it’s possible the bill could be interpreted as a ban on decentralized finance (DeFi). It is also not ideal for unelected bureaucrats and judges to decide in each case whether digital assets are security or not.
The Lummis-Gillibrand Responsible Financial Innovation Act
Republican Sen. Cynthia Lummis and Democratic Sen. Kirsten Gillibrand have put forth a comprehensive bill that would set standards for investor and consumer protection. Lummis has built a “pro-crypto” reputation, and the bill introduces a new term, “ancillary assets,” which is similar to utility tokens. Additionally, it is believed that the bill is a positive development for the crypto industry in general.
Related: Senator Lummis: My Bill With Senator Gillibrand Empowers the SEC to Protect Consumers
Crypto advocates need to be louder in their calls for regulatory clarity, as the SEC appears to be unsure of where to draw the line. Other organizations such as the Office of Foreign Assets Control (OFAC) and Financial Crimes Enforcement Network (FinCen) are also creating issues for the industry. Even industry figures are being taken into custody and extradited. The industry must reject any legislation that would compromise the openness of cryptocurrencies.
The House of Representatives will consider various cryptocurrency-related bills in 2023, making it a critical year for digital assets. Industry members must take action now to ensure that the events of this crypto winter don’t lead to overly harsh regulations.
Kadan Stadelmann is the CTO of Komodo Platform, a blockchain developer. He graduated from the University of Vienna in 2011 with a degree in information technology, and later attended the Berlin Institute of Technology for scientific computing and technical informatics. He joined the Komodo team in 2016.
This article is provided for informational purposes only. It is not intended to be used as investment or legal advice. The views, thoughts, and opinions expressed in this article are solely the author’s and do not necessarily reflect the views or opinions of Cointelegraph.
