All platforms involved in the transaction of cryptocurrencies would have to register with the CFTC under the legislation introduced by Democrats. It would be including traders, dealers, brokers, and websites that handle clients’ cryptocurrency. The two democrats are Stabenow and Boozman from Michigan and Arkansas, respectively.
Washington: The recent attempt by Lawmakers to come up with suggestions on how to manage a multibillion-dollar business was made on Wednesday. This unique step was taken when a congressional committee of US senators submitted a measure yesterday to regulate cryptocurrency. The commodity is currently plagued by plummeting prices and lenders are ceasing operations.
The Commodities Futures Trading Commission (CFTC) would be authorized to be the preferred regulator for cryptocurrencies. This is to be established under the legislation proposed by John Boozman and Debbie Stabenow, the chair of the Senate Agriculture Committee.
The initiative is in opposition to bills put out by other Congressmen and consumer advocates. They had advocated granting the US Securities and Exchange Commission (SEC) the ability to regulate the same.
“This measure will give the CFTC sole control over the spot market for digital commodities, resulting in enhanced consumer protections, market integrity, and progress in the digital commodities field.”
John Boozman, Senior Republican Senator
The CFTC must have the right instruments to oversee this expanding industry, according to Thune.
Previous Initiatives for Regulation
The idea can be tacked to the list of legislation that Congress has released this year. The SEC seems to be traditionally a far larger and better-funded regulator than the CFTC. It has hordes of agents to look into any malfeasance. By placing user fees on the cryptocurrency sector, the measure seeks to address these problems by funding more thorough CFTC regulations of the sector.
The Stablecoin TRUST Act, sponsored by Sen. Pat Toomey, R-Pa., in April, would provide a framework for regulating stablecoins. This regulation is primarily pertaining to the coins which have suffered significant losses this year. A form of cryptocurrency known as a stablecoin is anchored to a certain value, often the US dollar, another coin, or gold.
Likewise, in June this year, Senators Cynthia Lummis of Wyoming and Kirsten Gillibrand introduced the Responsible Financial Innovation Act. It is a comprehensive piece of legislation requiring the IRS to adopt guidelines on merchant acceptance of digital assets and charitable contributions. This bill also proposed legal terms for digital assets and virtual currencies. Further, for the first time, it made the demarcation among digital assets that are commodities versus securities. In addition to the proposed legislation
The House Financial Services Committee is now also working on another proposal. But meanwhile, the discussions related to this new proposal have stopped.
State of Cryptocurrency
Owners of cryptocurrencies have already witnessed prices collapse this year, businesses collapse, and fortunes and employment vanish overnight. federal officials have charged some organizations for operating an unauthorized securities exchange.
The most valuable digital asset, bitcoin, is currently only worth a small portion of its record-high price. It was more than $68,000 which is approximately Rs. 5,381,900, in November of last year. As per sources, Bitcoin on Wednesday stood at about $23,000 which is nearly Rs. 1,820,300 in Indian currency. Some industry executives have dubbed the current time period a “crypto winter”. And several politicians have been frantically trying to enact strict regulations.
In a study published in November of last year, US President Joe Biden’s working group on financial markets urged Congress to enact laws governing stablecoins. Earlier too this year, Biden issued an executive order directing several agencies to consider measures to regulate digital assets and products.
