US House Republicans introduce new bill for crypto oversight to protect investors.

US House Republicans introduce new bill for crypto oversight to protect investors.

The US House of Representatives Introduces New Cryptocurrency Oversight Bill

In recent months, US lawmakers have been actively working towards creating a clear regulatory framework for the blockchain industry. On Thursday, July 20, the US House of Republicans introduced a new cryptocurrency oversight bill with the goal of providing investor protection and establishing a regulatory framework for digital assets in the country.

The introduction of this bill is part of a series of efforts to establish clear rules for the crypto industry. Currently, the lack of regulatory clarity and the aggressive actions from authorities have caused some crypto businesses to consider leaving the US. Additionally, many crypto startups are hesitant to commence operations due to the uncertain regulatory environment.

Chairman of the House Committee on Agriculture, Rep. Glenn “GT” Thompson (R-Pa.), emphasized the importance of this bill in a statement, saying, “Today’s introduction of the Financial Innovation and Technology for the 21st Century Act marks a significant milestone in the House Committees on Agriculture and Financial Services efforts to establish a much-needed regulatory framework that protects consumers and investors and fosters American leadership in the digital asset space.”

The bill, initially drafted in early June, aims to create a regulatory framework for crypto exchanges to register with the US Securities and Exchange Commission (SEC). This framework would enable these exchanges to trade digital securities, commodities, and stablecoins all in one place. Dusty Johnson (R-S.D.) added, “The crypto industry wants clarity and our collaborative bill gives both the CFTC and SEC a seat at the table. Our bill establishes clear principles to ensure financial security and certainty as digital asset developers continue to innovate.”

Industry Experts Express Concern Over Revised Bill

However, despite the efforts made by Republican lawmakers, some industry experts have expressed their concerns regarding the revised bill. On page 10 of the bill, traditional securities such as stocks, bonds, “transferable shares,” and “certificates of interest or participation in any profit-sharing agreement” are excluded from the definition of “digital assets.”

According to Gabriel Shapiro, Delphi Labs’ general counsel, this recent change significantly impacts the value proposition of the bill and could reintroduce ambiguity. Furthermore, this change could potentially lead to increased regulation for various assets in the decentralized finance (DeFi) market, even if they are not currently regulated. Shapiro warns, “The SEC can still go on the warpath… all they have to do is argue that a token is a ‘transferable share’ or ‘a profit interest’.”

This concern highlights the potential risks of excluding certain traditional securities from the regulatory framework. It raises questions about the extent of regulatory oversight and the potential impact on various assets within the blockchain industry.

To better understand the implications of the bill, let’s take a closer look at its key provisions:

Key Provisions
Creation of a regulatory framework for crypto exchanges
Requirement for crypto exchanges to register with the SEC
Authorization for trading digital securities, commodities, and stablecoins
Collaboration between the CFTC and SEC for regulatory oversight
Establishment of clear principles for financial security

This table provides a concise summary of the bill’s main provisions, highlighting its focus on creating a regulatory framework, registration requirements for exchanges, and the collaboration between regulatory bodies.

In conclusion, the introduction of the new cryptocurrency oversight bill by the US House of Republicans is a significant step towards establishing a regulatory framework for the blockchain industry. While it aims to provide investor protection and clarity, concerns have been raised about the exclusion of certain traditional securities from the definition of digital assets. As the bill progresses, it will be essential to address these concerns and strike a balance between regulation and innovation within the industry.