The draft of a new bipartisan crypto bill by US senator Kirsten Gillibrand and Cynthia Lummis will be released to the US Congress by mid-April to provide much-needed regulatory clarity.
Senator Gillibrand hinted about the new bill in a Senate Agriculture Committee hearing on Wednesday, March 8. The Commodity Futures Trading Commission (CFTC) chair Rostin Behnam appeared before to committee to testify about the oversight of the commodity regulator.
Work on a Crypto Bill is Ongoing
The hearing mostly revolved around the crypto markets. Firstly, senator Marshall mentioned Binance and the FTX collapse to ask Behnam if CFTC had the resources and expertise to bring crypto activities into compliance. The regulator’s head said that they had the expertise, but not the resources and regulatory clarity.
Behnam emphasized the need for comprehensive regulations around crypto. Kirsten Gillibrand, US senator to New York, later told the committee that she is pioneering a new bill along with Senator Cynthia Lummis, one of the few voices for crypto in the US Congress, to craft a comprehensive framework for crypto. She said that the draft of the bill would be ready by mid-April.
“[1:16:39]Our ambition is to make sure that there is a place to start a national conversation about a holistic approach to digital assets to make sure that digital assets have the character of securities are regulated by the SEC, to have the assets that have the additions of commodities are regulated by the CFTC, to make sure stablecoin can be overseen by the OCC, and to make sure that there are tax provisions for the entire industry.”
The duo also presented a comprehensive draft in July 2022 but was deferred to the next year. The new bill, if signed into law, would clarify that which assets would fall under the purview of the SEC and CFTC.
CFTC Considers ETH and Stablecoins Commodities unless Congress Tells Otherwise
After the hearing, Rostin Behnam said to the media that the CFTC would consider Ether (ETH), the second-largest crypto asset by market cap, and fiat-based stablecoins like USDC as commodities unless Congress classifies them the other way.
This is a pretty stark (almost impassioned?) rebuke of the ‘everything except BTC is a security’ and ‘stablecoins are securities’ positions. Would be great if the CFTC released the legal analysis on these issues Chairman Behnam says it did. https://t.co/RIeTgUxTFd pic.twitter.com/LGtuEPs4X3
— Lawtoshi (@lawtoshi) March 8, 2023
This is the stark contrast to the SEC view of stablecoins, which, as reported, banned Paxos to mint BUSD, labelling the stablecoin as an unregistered security. In a similar vein, the securities regulator considers every non-Bitcoin crypto asset, including Ether (ETH), as securities.
Therefore, the upcoming bill will be the key to solving the inter-regulatory fight that is back holding this promising financial sector.