Landmark bipartisan legislation treats most digital assets as commodities
Sens. Cynthia Lummis and Kirsten Gillibrand introduced the Responsible Financial Innovation Act, a legislation that will create a complete regulatory framework for digital assets that encourages responsible financial innovation, flexibility, transparency, and robust consumer protections while integrating digital assets into existing law.
Understanding that most digital assets including Bitcoin and Ether are more similar to commodities than securities, the bill gives the U.S. Commodity Futures Trading Commission (CFTC) clear authority to regulate most of the industry.
Cryptocurrencies and other digital coins will not be treated like traditional securities under the U.S. Securities and Exchange Commission’s scrutiny unless the holder is entitled to the privileges enjoyed by corporate investors like dividends, liquidation rights, or a financial interest in the issuer.
According to both senators’ joint Medium post, the market’s recent volatility has shown that providing a regulatory framework is necessary for the crypto industry to thrive. “With the guidelines in our legislation to regulate digital assets, we can increase investor confidence, stabilize the market, and foster economic growth in communities across the country,”.
To date, the Lummis-Gillibrand bill is the most substantial and comprehensive bipartisan effort to provide certainty and clarity to the growing digital asset and #blockchain industries.
Full press release here.