US crypto’s future could fall on these 4 digital asset bills

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At least 50 digital asset claims have been filed since 2022 reportedly It was introduced into Congress with the aim of controlling everything from stablecoins to US regulatory jurisdictions.

However, at least four of them are seen as potentially having a significant impact on the industry (if passed), given the attention they received from both lawmakers and the crypto industry.

Financial Innovation and Technology Law for the 21st Century

The bill, which was introduced on July 20, aims to create a robust process for determining whether digital assets are commodities or securities, and would clarify the jurisdiction of regulators.

The bill, introduced by Republicans on the U.S. House Agriculture and Financial Services Committees, gives the Commodity Futures Trading Commission (CFTC) power over digital commodities and clarifies the jurisdiction of the Securities and Exchange Commission (SEC).

The process of crypto assets labeled as securities will also be given avenues to be relabeled as commodities. This could lead to the resurrection of some projects after they were effectively shut down due to past legal decisions.

Responsible Financial Innovation Act (RFIA)

The Lumis-Gillibrand Act, or a bill with a similar purpose, known as the RFIA, aims to clarify the roles of the SEC and CFTC in cryptocurrency regulation. It also aims to increase consumer protection by enacting legislation that “prevents events like FTX from happening again,” according to the bill’s fact sheet.

Clarifying the tax treatment of digital assets is also covered, with the Federal Reserve being mandated to “fairly” process bank applications for master accounts from cryptocurrency companies.

It will also allow only depository financial institutions to issue stablecoins, make room in tax law for Decentralized Autonomous Organizations (DAOs), and commission an advisory board along with a number of regular reports on the industry.

Digital Asset Market Structure Act (DAMS)

DAMS, filed on June 1, is another bill that aims to define the crypto-related roles of the SEC and CFTC and set a framework for regulators to determine whether a particular cryptocurrency is a security or a commodity.

The bill has received some attention, and on June 26, Rep. Maxine Waters wrote to Treasury Secretary Janet Yellen and SEC Chairman Gary Gensler asking them to consider the bill.

The proposed legislation would require certain crypto tokens to be certified by the SEC to prove they are properly decentralized before being granted commodity status.

Cryptocurrency exchanges will be able to register with the SEC as Alternative Trading Systems (ATS), and regulators will no longer be able to deny registration because they are platforms that trade digital assets.

Cryptocurrency company Promethium is an SEC-registered ATS that can offer trading, clearing, settlement and custody of digital assets, although it is currently unclear what assets the SEC will allow.

DAMS will be required to clarify ATS rules to allow digital commodities and stablecoins to be traded on the ATS platform, and SEC will allow broker-dealers to store cryptocurrencies if requirements are met.

Digital Commodities Exchange Act (DCEA)

First introduced in September 2020, the updated version of the DCEA was finally reintroduced in April 2022, adding that stablecoin providers can register as “Fixed Value Digital Commodity Operators”, including recording and reporting requirements.

The DCEA authorizes the CFTC to register and regulate spot exchanges that operate under the same rules as other commodity exchanges.

Cryptocurrencies that are not considered securities are labeled as digital goods under CFTC jurisdiction, and the SEC will crack down on the offering of cryptocurrency securities.

Developers of cryptocurrency projects can also voluntarily register with the CFTC to submit disclosures required to open and list their assets on exchanges.

Other invoices

More crypto bills have passed Congress with varying degrees of success. Stablecoin regulatory proposals have been submitted through the Stablecoin Trust Act and the Stablecoin Innovation and Protection Act.

Related: Congress May Be “Unruly,” But The U.S. Could Enact Crypto Bills In 2023

The descriptive titles “Cryptocurrency Consumer Investor Protection Act” and “Cryptocurrency Exchange Disclosure Act” were introduced in December 2022, but have not seen much movement since then.

The Digital Asset Anti-Money Laundering Act was also introduced in December by Senators Elizabeth Warren and Roger Marshall, which regulates crypto ATMs and bans financial firms from using crypto mixers. Warren vowed to reintroduce it in February, but that action has yet to materialize.

opinion: Republican Crypto Maximalism Is Almost As Bad As Democrats’ “Anti-Crypto Legion”