Just-In: Congressman Reveals New Crypto Bill For SEC & CFTC Joint Regulation

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As a seasoned researcher with a keen interest in the intersection of technology and finance, I find the BRIDGE Digital Assets Act proposed by Congressman John Rose intriguing. With my extensive background in studying digital assets and their regulatory landscape, I can appreciate the need for harmonization between the SEC and CFTC.

As a researcher focusing on financial regulations, I am highlighting a significant development: Tennessee Representative John Rose, a key member of the Financial Services Committee, is proposing a groundbreaking crypto bill designed to redefine the regulatory landscape governing digital assets within the United States.

The proposed legislation is known as the “Bridging Regulation and Innovation for Global and Electronic Digital Assets Act,” or simply the “BRIDGE Digital Assets Act.” Its purpose is to create a unified advisory committee on digital assets, comprising members from both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).

Contents of New Crypto Bill

In simpler terms, the Joint Advisory Committee will provide guidance on the laws, guidelines, and standards related to digital currencies. As stated in the bill, its purpose is to encourage consistent regulation across the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). These two entities are currently responsible for regulating different aspects of cryptocurrency.

Therefore, the suggested committee in the crypto bill will be responsible for devising methods to evaluate key aspects of digital assets. These elements include their degree of decentralization, functionality, and security. Furthermore, Congressman Rose expressed that the current approach of regulation through enforcement is ineffective and is actually encouraging development and investment overseas. Additionally, today the eToro trading platform reached a settlement with the Securities and Exchange Commission for $1.5 million, an action many view as suppressing innovation.

HEADLINE: GOP Representative John Rose of Tennessee, a member of the Financial Committee, unveils the “BRIDGE Digital Assets Act” – proposing a joint panel between SEC and CFTC to discuss digital assets.
The purpose of the…
— Eleanor Terrett (@EleanorTerrett) September 12, 2024

According to Rose, the Joint Advisory Committee on Digital Assets will establish a collaborative structure that allows both the government and private sector to work together towards a prosperous regulatory environment for digital assets and their industry participants. He also underscored the importance of partnership between these two sectors to ensure effective regulation.

As an analyst, I’d like to highlight that the proposed crypto bill requires a committee with at least 20 members from the private sector. This diverse group will comprise digital asset issuers, scholars conducting research in this field, and everyday users of these assets. These key players will function as advisors, offering insights on effective regulation while fostering innovation to both the SEC and CFTC.

Addressing Current Regulatory Gaps

The BRIDGE Digital Assets Act aims to address increasing discontent within the digital assets sector due to unclear and inconsistent regulations. Frequently, the SEC and CFTC have disagreed on jurisdiction, with the SEC classifying some cryptocurrencies as securities, while the CFTC considers them commodities.

Essentially, the purpose of the Joint Advisory Committee is to eliminate any differences in regulations. This alignment of opinions among the regulatory bodies will be facilitated by the committee. Moreover, the committee’s responsibilities extend to examining the possibility of blockchain technology and distributed ledger systems for improving financial market infrastructure.

This legislation aims to enhance consumer safeguards, boost transparency, and lower transaction expenses. Additionally, it seeks to broaden financial service availability via digital assets. The crypto act mandates that the SEC and CFTC establish a joint committee charter within 90 days following its approval.

As the analyst, I’m sharing the timeline for the appointment of members and the initial meeting of the committee. Members will be appointed within the next 120 days. The first gathering of the committee is expected to take place within the following 180 days. Regular meetings will occur at least twice a year, and additional sessions may be scheduled as required by either commission upon request.

Should the BRIDGE Digital Assets Act bill be approved, it would represent a substantial move in digital asset regulation. At present, the Securities and Exchange Commission (SEC) is under fire as Chairman Gary Gensler faces accusations of illegal hiring practices. This controversy might have an adverse effect on any future partnership between the SEC and Commodity Futures Trading Commission (CFTC).

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2024-09-12 21:34