- The aim is to set digital assets free from enforcement actions by the SEC.
- The draft is yet to receive the support of the Democrats.
The cryptocurrency sector in the US could soon get the much-needed regulations if a proposed draft by a section of Congress is adopted.
The House Financial Services Committee Chairman, Patrick McHenry, and Glean Thompson, the Chair of the House Committee on Agriculture, released a discussion draft on the statutory framework for digital assets regulations on June 2.
The discussion draft aims to enable digital asset platforms to register in the US with the SEC, allowing users to trade assets, commodities, and stablecoins in one place. Further, the draft proposes removing the ongoing enforcement actions by the two regulators, CFTC and SEC.
“This discussion draft is the first step toward delivering on Republicans’ commitment to develop clear rules of the road for the digital assets ecosystem,” commented Chairman Mc-Henry. “Our goal is to strike the appropriate balance between consumer protection and encourage responsible innovation.”
Classification Of Digital Assets
On the controversial question of whether an asset is a security or a commodity: the discussion draft provides that the regulated entity makes the case. There has been a long-standing tussle between the SEC and the CFTC on who should regulate what in the sector.
However, the proposal adds that the regulated entity should explain how they operate and prove to the regulating agency that they are decentralized and no single person controls more than 20%.
“For months, our committees have worked collaboratively to establish a viable regulatory framework for digital assets necessary to protect consumers and promote American innovation,” said Chairman Thompson. “Today’s release of the discussion draft brings us one step closer to bringing regulatory uncertainty to these novel and emerging technologies.”
However, as of Friday, the draft bill had not received the support of the Democrats and would need the support of the Senate to pass.
