US Senators Cynthia Lummis and Kirsten Gillibrand will reintroduce legislation aimed at establishing a comprehensive regulatory framework for digital assets.
US legislators saying they would resubmit the Responsible Financial Innovation Act to the Senate on July 12 about a year after it was introduced in the previous session of Congress. The bipartisan legislation (Lummis is a member of the Republican Party and Gillibrand is a Democrat) was aimed at clarifying the roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission in regulating digital assets, as well as how to provide consumer protection.
The cryptocurrency industry is here to stay.
Today, @SenGillibrand and I am reintroducing landmark legislation to create a federal regulatory framework that allows crypto businesses and investors to thrive here in America while protecting consumers from bad actors. pic.twitter.com/z2pr0evWt2
โ Senator Cynthia Lummis (@SenLummis) July 12, 2023
The Lummis-Gillibrand bill was first introduced in June 2022 amid the crypto market crash that led to the bankruptcy of several high-profile companies and the price of many tokens plummeting. According to the fact sheet provided by Lummis, the updated legislation will include updates to the US tax code that will allow the industry to "fund its own oversight" as well as protective measures "to prevent another FTX-style event from happening." : the cryptocurrency exchange. it collapsed in November 2022 after the bill was introduced.
Lummis and Gillibrand's bill was drafted after the collapse of Terraform Labs, the South Korea-based company that saw its algorithmic stablecoin depegged from the US dollar. As a result, the legislation will also require payment stablecoins to be issued only by depository institutions.
Related: US Senator Renews Efforts for Crypto Regulations Amid SEC Lawsuits
Some lawmakers and industry leaders have criticized US regulators for a lack of clarity that would allow companies to operate without risk of enforcement actions or other crackdowns. Many in space have praised the Lummis-Gillibrand bill to take bipartisan action at a time when some elected officials have politicized aspects of the crypto space, from Senator Elizabeth Warren highlighting illicit uses Digital Assets to Florida Governor and 2024 Presidential Candidate Ron DeSantis asking for a ban in central bank digital currencies.
While the Responsible Financial Innovation Act is one option, members of the House of Representatives have proposed other legislation aimed at addressing a framework for cryptocurrencies. A discussion draft published in June in the House greatly limit the authority of the SEC on crypto companies, while the House Financial Services Committee has also drafted legislation proposing to the Federal Reserve become the main regulator behind the establishment of requirements for stablecoins.
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