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United States Lawmakers Propose Bill to Clarify the SEC’s Crypto Regulatory

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US lawmakers want to make the SEC’s regulation of cryptocurrency clearer, so they have proposed a bill to that effect.

The bill’s framework aims to crack down on the SEC’s past approach to cryptocurrencies while permitting certain tokens to classify as digital commodities.

The US House Financial Services Committee and House Agriculture Committee also publicized a draft discussion providing certain cryptos with a route to label as digital commodities.

According to the published discussion draft on June 2, lawmakers suggested “establishing a functional framework.”

The goal is to bring regulatory clarity to cryptocurrency companies operating within the United States.

The draft bill, also, would stop the United States Securities and Exchange Commission (SEC) from rejecting the registration of digital asset trading firms as regulated alternatives in the trading system.

Such trading firms will further be able to provide “digital commodities as well as payment stablecoins.”

Proposed Bill to crack down on SEC’s Previous Approach to Crypto

US lawmakers want to make the SEC's regulation of cryptocurrency clearer, so they have proposed a bill to that effect.

Considering the critics from many in the cryptocurrency space against the SEC, the proposed bill cracks down specifically on SEC for not offering clear rules in its regulatory journey.

The bill’s framework would also qualify certain digital assets that are “functional and considered decentralized” as digital commodities.

If the SEC has any objections to the classification of any firm qualified as decentralized, they must provide a “detailed analysis.”

According to the draft, “The Act also subjects the SEC to revise its rules, allowing broker-dealers that meet certain requirements to custody digital assets.”

“Furthermore, the Act would need the SEC to write rules, modernizing certain regulations for digital assets,” said the draft.

The Chief Legal Officer of Coinbase, Paul Grewal, commended the draft bill, stating that it “lays a solid ground for regulatory definitions and jurisdictions” but warranted an in-depth examination before any formal introduction.

The US-based cryptocurrency exchange, Coinbase, recently established a pro-adoption ad campaign before a lobbying-centered event scheduled for July in Washington, D.C.

Read Also: The Former SEC Chief Threats to Crypto Influencers

President Biden to sign the bill on June 2

The legislation was introduced by Republican politicians Patrick McHenry, chair of the House Financial Services Committee, and Glenn Thompson, chair of the House Agriculture Committee, without involvement from their Democratic counterparts.

Although Democrats and Republicans have occasionally shown an interest in working together to regulate cryptocurrencies, it’s not clear how far the proposed bill could get in a politicized Congress.

At the time of release, the House and Senate of the United States had enacted bills to raise the debt ceiling to prevent a default on the government. On June 2, President Joe Biden is expected to sign the legislation into law.

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