US senators have re-presented the cryptocurrency bill aimed at comprehensive regulation. The Responsible Financial Innovation Act will create railings “to prevent another FTX-style event from occurring” following the 2022 market crash and bankruptcies.
Senators’ comprehensive crypto money bill is on the agenda again!
United States Sens. Cynthia Lummis and Kirsten Gillibrand will reintroduce legislation aimed at creating a comprehensive regulatory framework for digital assets. US lawmakers have said they will reintroduce the Responsible Financial Innovation Act to the Senate on July 12, after waiting nearly a year in the previous session of Congress. The bipartisan bill, of which Lummis is a member of the Republican Party and Gillibrand a member of the Democratic Party, aims to clarify the roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission in regulating digital assets. It also aims to protect consumers.
The Lummis-Gillibrand bill was first introduced in June 2022. cryptocoin.comAs you follow, many high-profile crypto firms went bankrupt during this period. We also witnessed the crypto market crash that caused the price of many tokens to fall sharply. According to the fact sheet provided by Lummis, the updated legislation will include updates to U.S. tax code that allow the industry to “fund its own surveillance”, as well as guardrails “to prevent another FTX-style incident from occurring.” Meanwhile, it is worth noting that the crypto exchange FTX crashed in November 2022 after the bill was introduced.
Lummis-Gillibrand’s design was praised!
Lummis and Gillibrand’s bill was drafted after the collapse of the algorithmic stablecoin Terra USD (USDT). The stablecoin of South Korea-based firm Terraform Labs collapsed along with its ecosystem that lost the US dollar peg. As a result, legislation will also only allow depository institutions to issue payment stablecoins.
Some lawmakers and industry leaders have criticized US regulators for their lack of clarity. They stated that it would allow firms to operate without the risks of sanctions or other repression. Many in this field have praised the Lummis-Gillibrand bill for its bipartisan action. Meanwhile, Senator Elizabeth Warren has highlighted the illegal use of digital assets. Florida governor and 2024 presidential candidate Ron DeSantis has called for a ban on central bank digital currencies. However, many saw them as politicizing various aspects of the crypto space.
The Responsible Financial Innovation Act is one option. However, members of the House of Representatives have also proposed other laws aimed at addressing a framework for cryptocurrencies. A bill in June proposed to drastically limit the SEC’s authority over crypto firms. Also, the House Financial Services Committee has proposed that the Fed take on the role of setting requirements for stablecoins.
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