New cryptocurrency surveillance legislation comes as the industry shakes

WASHINGTON (AP) – A bipartisan group of senators on Wednesday proposed a bill to regulate cryptocurrencies, the latest attempt by Congress to come up with ideas on how to oversee a multi-billion dollar industry that has been devastated by the collapse of prices and disruption. transactions by credit institutions.

Regulations proposed by Senate Agriculture Committee Chair Debbie Stabenow and top Republican member John Boozman would authorize the Commodities Futures Trading Commission to be the default cryptocurrency regulator. This would run counter to bills proposed by other congressmen and consumer advocates, who have suggested empowering the Securities and Exchange Commission.

This year, cryptocurrency investors have seen prices plummet and companies plummet with fortunes and jobs disappearing overnight, and some companies have been accused by federal regulators of running an illegal stock exchange. Bitcoin, the largest digital asset, is trading at a fraction of its all-time high, dropping from over $ 68,000 in November 2021 to around $ 23,000 on Wednesday. Industry leaders have called it a “crypto winter” and lawmakers are desperate to put in place strict oversight.

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The bill from Stabenow, a Democrat from Michigan, and Boozman, Arkansas, would require all cryptocurrency platforms, including merchants, resellers, brokers, and sites that hold cryptocurrencies for clients, to register with the CFTC.

READ MORE: The cryptocurrency crash is a wake-up call for many, including Congress

The CFTC is historically an underfunded and much smaller regulatory body than the SEC, which has armies of investigators to investigate potential wrongdoing. The bill attempts to mitigate these problems by imposing user fees on the cryptocurrency industry, which in turn would fund firmer oversight of the industry by the CFTC.

“Our bill will give the CFTC exclusive jurisdiction over the spot market for digital products, leading to greater consumer protections, market integrity and innovation in the digital product space,” Boozman said in a statement.

Senses. Cory Booker, DN.J., and John Thune, RS.D., are co-sponsors of the bill.

“It is imperative that the (CFTC) has the right tools to regulate this growing market,” said Thune.

The legislation can be added to the list of proposals that emerged from Congress this year.

Senator Pat Toomey, R-Pa., Introduced legislation in April, called the Stablecoin TRUST Act, which would create a framework to regulate stablecoins, which have suffered huge losses this year. Stablecoins are a type of cryptocurrency tied to a specific value, usually the US dollar, another currency, or gold.

Also, in June, the senses. Kirsten Gillibrand, DN.Y., and Cynthia Lummis, R-Wyo., Proposed a radical bill called the Responsible Financial Innovation Act. This bill proposed legal definitions of digital assets and virtual currencies; require the IRS to adopt guidelines on merchants’ acceptance of digital assets and charitable contributions; and it would distinguish between digital assets that are commodities and those that are securities, which has not been done.

Along with the Toomey legislation and the Lummis-Gillibrand legislation, a proposal is being drawn up in the House Financial Services Commission, although those negotiations have stalled.

Committee Chair Maxine Waters, D-California, said last month that although she, Republican Senior Member Patrick McHenry of North Carolina and Treasury Secretary Janet Yellen have made significant progress toward a settlement on the legislation, “sadly we are not there yet and therefore we will continue our negotiations during the mid-August holidays.

President Joe Biden’s Financial Markets Task Force released a report last November asking Congress to pass legislation that would regulate stablecoins, and Biden issued an executive order earlier this year calling on various agencies to look for ways to regulate. digital resources.

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