United States Senators Bring Bill on Cryptocurrency Regulation

United States Senators Bring Bill on Cryptocurrency Regulation
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PEOPLE/ECONOMY

United States Senators Bring Bill on Cryptocurrency Regulation

A bipartisan pair of US senators introduced legislation that would establish new cryptocurrency regulations.

06/10/2022

On Tuesday, a bipartisan pair of US senators introduced legislation that would establish new cryptocurrency regulations.

On Tuesday, a bipartisan pair of US senators introduced legislation that would establish new laws for Bitcoin while delegating most of the oversight to the Commodity Futures Trading Commission (CFTC).

The bill, proposed by Republican Senator Cynthia Lummis, one of Congress’ most ardent cryptocurrency enthusiasts, and also Democratic Senator Kirsten Gillibrand. She is one of lawmakers’ most ambitious initiatives yet to put clear guardrails around rapidly growing and also contentious cryptocurrency exchanges.

Bill on Cryptocurrency Regulation

The legislation would require the CFTC, rather than the Securities and Exchange Commission, to play the primary role in regulating crypto goods. The majority of which, according to the senators, behave more like commodities than securities, according to the report. In addition, the smaller CFTC is often regarded as a friendlier regulator for cryptocurrencies. But, the SEC has typically determined that crypto goods must comply with a slew of securities laws.

The bill is not expected to become law in the current session of Congress, with the midterm elections just months away. However, its framework could serve as a starting point for future debates about how best to oversee those markets.

“We expect this bill to be the starting point for debate next year regardless of whatever party controls the House or the Senate,” noted Cowen Washington Research Group analyst Jaret Seiberg. “What matters is that there is a bipartisan effort underway to incorporate cryptocurrency into the existing regulatory framework, even if the details are likely to change.”

Clarity to Crypto Markets

The senators stated that the law aims to provide consistency and also clarity to crypto markets, as well as consumer protections.

Among other things, the law would establish new rules for “stablecoins,” which are tokens whose value is tied to a traditional asset like as the US dollar. These goods have recently been under tremendous strain when the value of a prominent stablecoin, TerraUSD, plummeted.

The new bill would force stablecoin issuers to keep high-quality liquid assets equivalent to the value of all issued stablecoins and also make those holdings public.

By Elah Mae Ariate Wozinga Staff

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