On Friday, Patrick McHenry (R-North Carolina) and Glenn Thompson (R-Pennsylvania), Committee Chair of Financial Services and Agriculture, released a draft bill that would provide clarity to crypto firms and create a regulatory framework for digital assets.
“The current regulatory framework for digital assets hinders innovation and fails to provide adequate consumer protection,” stated a summary of their bill.
Tokens offered as a part of an investment contract would remain under SEC and those tokens that qualify as commodities would be under Commodity Futures Trading Commission (CFTC).
To consider a digital asset as a commodity, the main requirement to that it should be decentralized. These digital asset commodities will be eligible for sale on SEC-registered digital asset trading systems.
To enhance transparency and accountability, market participants will face new disclosure requirements and registration with both the CFTC and the SEC. To create consistent regulatory standards, the agencies would work with foreign regulators.
The Government Accountability Office would be required to complete a study on Non-fungible Tokens (NFTs) and how they fit into traditional marketplaces.
Cosponsors of the bill, US Congressmen French Hill and Dusty Johnson, sent a letter to SEC chair Gary Gensler criticizing the agency’s so-called “regulation by enforcement” of the crypto industry a day before proposing the bill.
One of the documents stated, “The SEC’s existing regulatory regime is not designed to accommodate the registration and regulation of digital assets. The SEC has failed to provide the clarity these entities need to operate.”
The two House Committees have been working together on the digital assets bill for a year. Glenn Thompson, Tom Emmer, and Warren Davidson were other cosponsors of the bill.
Senator Cynthia Lummis and Kirsten Gillibrand introduced a new version of their bipartisan Responsible Financial Innovation Act last week, which this bill will complete.
Also Read: Crypto Advocacy Groups Slam “Unworkable” US Senate DeFi Bill
