The bill's framework would curtail the SEC's previous crypto policy and allow certain tokens to be considered digital commodities if they are decentralized.
A draft discussion has been made available by lawmakers on the House Agriculture Committee and the House Financial Services Committee of the United States. It gives some crypto assets a way to be called digital commodities.
As per a conversation draft distributed on June 2, officials proposed "laying out a utilitarian structure" pointed toward giving administrative clearness to crypto firms in the US. The proposed legislation would permit digital asset trading platforms to offer "digital commodities and payment stable coins" and prevent the Securities and Exchange Commission (SEC) from preventing them from registering as regulated alternative trading systems.
More specifically, the legislation that is being proposed tightens up on the approach that many people in the crypto industry have criticized the SEC for taking by not providing clear guidelines. The bill's framework would require the SEC to provide a "detailed analysis" of any objections to a firm's classification as decentralized and allow certain digital assets to qualify as digital commodities if they were "functional and considered decentralized."
The draft stated, "The Act also requires the SEC to modify its rules to allow broker-dealers to custody digital assets if they meet certain requirements." The Act would also require the SEC to write rules to modernize certain digital asset regulations.
Paul Grewal praised the draft bill, stating that it "lays a strong foundation for regulatory jurisdiction and definitions," but that it needed to be thoroughly examined before being introduced officially. A pro-adoption advertising campaign was recently launched by the crypto exchange in the United States ahead of a July event in Washington, D.C., focused on lobbying.
Related: The US SEC's crackdown on crypto staking could boost decentralization.
The legislation, which was introduced by Republicans Glenn Thompson and Patrick McHenry of the House Financial Services Committee, lacked input from lawmakers on the other side of the political aisle. Although Democrats and Republicans have occasionally shown that they are willing to take a bipartisan approach to the regulation of cryptocurrencies, it is uncertain how far the proposed legislation could advance in a Congress that is divided.
At the time of publication, the House and Senate of the United States had passed legislation to raise the debt ceiling to prevent the government from defaulting. President Joe Biden is supposed to sign the bill into regulation on June 2.
(TURNER WRIGHT, Cointelegraph, 2023)