The United States is developing a comprehensive law to strictly regulate cryptocurrencies in the country. The House of Representatives took up legislation on July 29, 2021, to provide a comprehensive legal framework to regulate the digital asset market and possibly grant the federal government the ability to ban some stablecoins.
According to sponsor Rep. Don Beyer (D-Va.), chairman of the U.S. Congress Joint Economic Committee, the existing digital asset market structure and regulatory framework are too “ambiguous and dangerous for investors and consumers.”
According to Beyer, there are an estimated 11,000-plus separate digital asset tokens in existence, with a market cap of over $1.5 trillion while 20 million to 46 million Americans currently own bitcoin and other digital assets.
- Create statutory definitions for digital assets and digital asset securities and provide the Securities and Exchange Commission (SEC) with authority over digital asset securities and the Commodity Futures Trading Commission (CFTC) with authority over digital assets
- Require digital asset transactions that are not recorded on the publicly distributed ledger to be reported to a registered Digital Asset Trade Repository within 24 hours to minimize the potential for fraud and promote transparency.
- Explicitly add digital assets and digital asset securities to the statutory definition of “monetary instruments,” under the Bank Secrecy Act (BSA), formalizing the regulatory requirements for digital assets and digital asset securities to comply with anti-money laundering, recordkeeping, and reporting requirements.
- Provide the Federal Reserve with explicit authority to issue a digital version of the U.S. dollar, clarify that digital assets, digital asset securities and fiat-based stablecoins are not U.S. legal tender, and provide the U.S. Treasury Secretary with authority to permit or prohibit US dollar and other fiat-based stablecoins
- Direct the Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), and Securities Investor Protection Corporation (SIPC) to issue consumer advisories on “non coverage” of digital assets or digital asset securities to ensure that consumers are aware that they are not insured or protected in the same way as bank deposits or securities.
