Can Congress Establish Regulatory Structure For Crypto Industry?
- A key congressional committee will vote on bills establishing crypto regulations this week.
- U.S. House Republicans introduced a bill for a regulatory framework on crypto exchanges.
- Bipartisan bill aims to strengthen KYC and AML regulations for DeFi with sanctions requirements.
On July 26, Reuters reported that this week, a significant congressional committee is scheduled to vote on several bills aimed at establishing a regulatory structure for crypto. Through this voting, Capitol Hill is taking a significant step to establish federal oversight of the digital asset industry.
On Thursday, U.S. House Republicans presented a bill focused on overseeing digital assets, with the primary objective of setting up a regulatory structure to safeguard investors within the crypto sector. The bill, which was initially drafted in early June, seeks to establish a clear regulatory framework for crypto exchanges. Its primary objective is to facilitate the registration process for these exchanges with the U.S. Securities and Exchange Commission (SEC). By doing so, these registered exchanges would gain the capability to trade digital securities, commodities, and stablecoins all within a single platform.
On the other hand, on July 18, United States Senator Jack Reed introduced a bipartisan bill in the Senate aimed at strengthening Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations, as well as sanctions requirements, specifically for decentralized finance (DeFi). The bill, known as the Crypto-Asset National Security Enhancement and Enforcement (CANSEE) Act, intends to bring DeFi operations under the same regulatory standards as other financial entities, including centralized crypto trading platforms, casinos, and pawn shops.
If passed, the bill would hold individuals who control DeFi projects responsible for the usage of their services by sanctioned individuals, making them liable for any potential illicit activities. This move is part of the broader effort to enhance national security measures and enforcement related to crypto-assets in the United States.
However, major crypto groups including Coin Center expressed concerns about the bill, stating that it grants the Secretary considerable discretion in determining the criteria for designating an individual or entity as having “control” over a protocol.
The report noted that it is yet to be seen whether the bills will gain any Democratic support, which many consider a critical factor in determining their likelihood of eventually becoming law. In addition, the proposed measures are also expected to encounter challenges in the Democratic-led Senate. Sherrod Brown, the head of the Senate Banking Committee, has previously been called out by lawyer John Deaton for promoting a false narrative about the crypto industry over Silvergate Bank’s insolvency.
Comments
Post a Comment