The US Congress has collected more than 50 bills aimed at regulating cryptocurrencies since 2022. These bills cover everything from stablecoin regulations to the jurisdictions of US regulators. However, we may see major effects of at least four of them (if they pass) in the coming periods…
4 US laws that will shape the future of cryptocurrencies
Financial innovation and technology law for 21st century law
Introduced on July 20, this bill is about the classification of coins and tokens. In general terms, it aims to determine whether a crypto is a commodity or a security. It also aims to clarify the jurisdictions of regulators.
The bill was first introduced by Republican members of the U.S. House Agriculture and Financial Services Committees. Specifically, another regulator with authority over cryptocurrencies with the SEC will clarify the CFTC’s power and jurisdiction over digital commodities.
With this law, a new process will begin for cryptocurrencies labeled as securities. At the same time, a new process will begin for them to be relabeled as commodities. The bill has positive effects for projects that were previously included in the red list.
Responsible Financial Innovation Act (RFIA)
Known as the Lummis-Gillibrand law or RFIA, the bill with similar objectives aims to clarify the roles of the SEC and CFTC in crypto regulation. It also aims to provide greater consumer protection by providing laws “to prevent another FTX-style incident from occurring,” according to the law’s fact sheet. The stock market, which went bankrupt in November 2022, stressed the need for regulatory clarity.
Cryptocurrency tax clarity is also addressed with the RFIA. Additionally, the Fed will be ordered to process bank applications for main accounts from crypto companies on an “equitable basis.” In particular, it will see depository institutions become the only institutions allowed to issue stablecoins. However, it will make room for decentralized autonomous entities (DAOs) in the tax code. Additionally, it will appoint an advisory committee with a series of regular reports on the industry.
Cryptocurrency Market Structure law (DAMS)
Introduced on June 1, DAMS is another bill that aims to define the crypto-related roles of the SEC and the CFTC and provide a framework for regulators to decide whether certain coins/tokens are securities or commodities.
The bill draws attention especially with its clauses. On June 26, Representative Maxine Waters sent letters to Treasury Secretary Janet Yellen and SEC chair Gary Gensler asking them to consider the bill. According to the proposed bill, a particular coin/token will need to be certified with the SEC to prove it is decentralized enough before it can be granted commodity status.
Crypto exchanges can register with the SEC as an alternative trading system (ATS). The regulator cannot reject an application just because a platform is focused on cryptocurrencies. Crypto firm Prometheum is one of the SEC-registered ATS companies. The law offers coin/token trading, swapping, settlement and custody, although it is not yet clear what assets the SEC allows.
DAMS will clarify ATS rules and allow trading of digital commodities and stablecoins on ATS platforms. Therefore, the SEC will need to allow broker-dealers to hold coins/tokens if they meet the requirements.
Digital Mercantile Exchange Act (DCEA)
An updated version of DCEA, first introduced in September 2020, was last reintroduced in April 2022. Additionally, stablecoin providers can register as a “fixed-value digital commodity operator”, including registration and reporting requirements.
The DCEA authorizes the CFTC to register spot exchanges, which are subject to the same rules as other commodity exchanges. Cryptocurrencies that are not considered securities qualify as digital goods under the CFTC’s view. The SEC, on the other hand, oversees crypto securities offerings.
Crypto project developers can also voluntarily register with the CFTC. This includes offerings such as trading publicly and listing assets on an exchange.
Other laws
Many more crypto laws are under consideration in Congress with varying success. Stablecoin regulatory proposals have come through the Stablecoin TRUST Act and the Stablecoin Innovation and Protection Act. The descriptively Crypto Consumer Investor Protection Act and Crypto Exchange Disclosure Act were introduced in December 2022 but haven’t seen much action since then.
The Digital Asset Anti-Money Laundering Act was also introduced by Senators Elizabeth Warren in December. cryptocoin.com We have included the details in this article. Roger Marshall plans to regulate crypto ATMs and ban financial companies from using crypto mixers (Tornado). Warren promised it would be re-released in February. However, this action has not yet taken place.
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