The United States is at the brink of a new era in the world of cryptocurrency, and the fate of this rapidly growing industry lies in the hands of the American legislative branch. Over the past nine months, Congress has seen an array of fifty bills presented to regulate the crypto space.
Among them, four key bills have emerged, each proposing directives that could shape the future of cryptocurrency in the country. We’ve broken down the details for you- Read on!
The First Bill
The Financial Innovation and Technology for the 21st Century Act is one such law proposition, unveiled on July 20th, focusing on establishing a concrete procedure for categorizing a digital asset – whether it is a commodity or security.
Originated by Republican representatives from the United States House’s Agriculture and Financial Services Committees, the act aims to vest the Commodity Futures Trading Commission (CFTC) with the authority to regulate digital commodities and elucidate the Securities and Exchange Commission’s (SEC) jurisdiction.
This act even proposes a pathway for cryptocurrencies classified as securities to be re-designated as commodities, potentially breathing new life into projects previously halted by legal judgments.
The Second Bill
Parallel in its ambitions to the previous bill, the Responsible Financial Innovation Act (RFIA) – or the Lummis-Gillibrand Bill, intends to delineate the roles of the SEC and CFTC in cryptocurrency regulation. Moreover, it seeks to enhance consumer protection by preventing incidents similar to the FTX debacle.
The RFIA also addresses digital asset tax treatment, calls on the Federal Reserve to process bank applications from cryptocurrency firms impartially, and limits the issuance of stablecoins to depository institutions.
Read Now: GAO Report Sounds Alarm on Crypto Regulatory Gap; Calls For Urgent Action
The Third Bill
The Digital Asset Market Structure Bill (DAMS), set forth on June 1, strives to outline the responsibilities of the SEC and CFTC related to cryptocurrency. This bill aims to instate a framework for regulators to determine whether specific cryptocurrencies are securities or commodities.
Furthermore, DAMS would require a crxyptocurrency to receive certification from the SEC for its decentralization before granting it commodity status.
The Fourth Bill
Finally, the Digital Commodity Exchange Act (DCEA), which saw its updated version re-introduced in April 2022, includes provisions for stablecoin providers to register as fixed-value digital commodity operators.
This bill would also empower the CFTC to regulate spot exchanges, bringing them under the same regulations as other commodity exchanges. This legislation provides a platform for cryptocurrency developers to voluntarily register with the CFTC, promoting transparency and compliance within the industry.
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