A Republican senator will soon introduce a bill to regulate cryptocurrency in a way that will allow the technology to flourish. According to reports, the bill would add investor protections, regulate stable coins that are tied to fiat currency and create a self-regulating body under the U.S. Securities and Exchange Commission and its sister, the Commodity Futures Trading Commission.
This proposal, which was first reported by Bloomberg, is the work of Sen. Cynthia Lummis (R-Wyo.), a proponent of crypto who has reportedly invested in virtual currencies (her crypto assets are estimated to total about a quarter million dollars).
Lummis plans to introduce legislation in early 2022 to clarify regulatory requirements on stable coins. This topic has been a long-standing subject of congressional debate due to concerns about liquidity and risks. She also intends to define different asset classes and provide additional protections for investors to protect them against scams, substantial losses and possibly lax cybersecurity.
Lummis also reportedly plans to establish a joint organization under the SEC/CFTC’s jurisdiction to monitor the market. This move, if it succeeds, could help end the ongoing debate about which U.S. regulators are competent to regulate digital assets.
Lummis used Twitter to request bipartisan cosponsors and encourage constituents to contact their elected officials to support the bill.
An aide for Lummis disclosed to Information Security Media Group that the proposed bill “is highly detailed and fully integrates digital assets into the U.S. financial system,” will address a wide range of issues including definitions, tax requirements, interagency coordination and most importantly, consumer protection.
The aide also explained that the bill “gives clear guidance to regulators,” “protects consumers through strong standards” and establishes “mechanisms for policing bad actors.”
“These and other policies in the legislation will guarantee that America’s burgeoning digital asset industry has the room it needs to grow, while making sure consumers are protected and scammers are prosecuted,” the aide added.
A member of the Senate Banking, Housing and Urban Affairs Committee, Cynthia Lummis has cooperated with Democratic colleagues, including lawmakers Mark Warner (D-Va.) and Kyrsten Sinema (D-Ariz.) to fix the defects in the crypto provisions that was hastily inserted in the Biden administration’s $1.2 trillion Infrastructure Investment and Jobs Act.
Moreover, Lummis and five senators sent a letter this month to Treasury Secretary Janet Yellen to address investor concerns about the reporting requisites. They claim the provision will hinder innovation in a time where clear guidance is much needed.