The U.S. Senate Agriculture Committee has released its long-awaited draft of the Cryptocurrency Market Structure Act, moving Congress closer to passing legislation outlining how the crypto sector will be regulated.
Republican Agriculture Chairman John Boozman and Democratic Sen. Cory Booker released the draft on Monday, which includes brackets for parts of the bill that lawmakers are still negotiating.
The bill aims to outline the limits of the Commodity Futures Trading Commission and Securities and Exchange Commission’s authority to regulate virtual currencies. Only Congress can set regulatory boundaries for government agencies, and the two governments have shared guidance for companies regarding cryptocurrencies under the Trump administration’s push for deregulation.
“The CFTC is the appropriate agency to regulate spot digital goods trading, and it is imperative that we establish clear rules for emerging crypto markets while protecting consumers,” Boozman said.
Booker said the discussion draft “gives the CFTC new authority to regulate the digital goods spot market, create new protections for retail customers, and ensure that the CFTC has the staff and resources it needs to oversee this growing market.”
Some parts of the cryptocurrency bill are still subject to change
The bill outlines common cryptographic terms such as “blockchain,” “decentralized finance,” and decentralized autonomous organizations and how they would be regulated under the Commodity Exchange Act.
Most of the bill is in brackets, indicating that it is subject to change. Part of the text cites a “minority opinion” held by Democrats on the committee that they do not believe the Agriculture Committee has jurisdiction over certain aspects and are interested in working with the Senate Banking Committee to “address issues related to non-dominant blockchain developers and providers of blockchain services.”
The Agriculture Committee has jurisdiction over the CFTC, and the Senate Banking Committee oversees the SEC, so they lead some of the legislation related to securities laws.
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Republicans on the Banking Committee released a discussion draft of their section of the bill in July, suggesting it be merged with the CLARITY Act, which the House passed in July, giving the CFTC a central role in regulating cryptocurrencies.
Encryption group progress returns
Ji Hoon Kim, CEO of the crypto advocacy group Crypto Council for Innovation, said the bill’s announcement “represents meaningful and positive progress toward establishing a comprehensive and fit-for-purpose market structure framework for digital products in the United States.”
Mason Rynow, community director for Stand with Crypto, Coinbase’s lobbying arm, said the bill is an “important step toward formalizing the common-sense regulatory framework” that the crypto industry has been calling for.
“The Senate must act quickly and carefully to pass market structure legislation,” he added. “Cryptocurrency advocates across the country are counting on elected officials to create clear rules.”
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