US Congressman Paul Gosar has been hard at work to clarify where cryptocurrencies stand in the United States.
To throw more light on the different forms of digital assets, he has put forward the Crypto-Currency Act of 2020. A bill designed to clearly regulate the crypto industry and allow regulators to validate crypto assets in the United States.
The US digital asset regulatory space has been a mumble jumble of a lot of half baked regulations so far. With Nasdaq’s former CEO referring to regulators as “slower than erosion”. According to Andrew Yang, most cryptocurrency regulations available today were formed from outdated judicial precedents. And the US digital assets space needs a fresh set of well-drafted regulations.
Gosar on March 9, published what he calls the “Crypto-Currency Act of 2020”. Designed to not only provide clarity but also legitimize crypto assets in the United States.
According to the bill, digital assets can be classified into three types: Crypto-commodity, Crypto-currency, and Crypto-security. The bill proposed that the three categories should be supervised by the CFTC, FinCEN and the SEC respectively.
Surprisingly, the bill classified digital assets like Bitcoin as Crypto-commodities and not Crypto-currency. Crypto-currency definition according to the bill, seemed to refer to stablecoins like Tether (USDT). The classification states that Crypto-currency is “representations of United States currency or synthetic derivatives”.
Crypto-securities, on the other hand, referred to “all debt, equity, and derivative instruments” built on a blockchain or a “decentralized cryptographic ledger.” The bill, however, did not in any way mention non-fungible tokens (NFT).
An updated version of December 2019 leak
First leaked last December, the “Crypto-Currency Act of 2020” is an updated version of the leaked bill. Most of the update mainly clarified definitions for terms like “Decentralized cryptographic ledger” and “Smart contract”. It is also more detailed with regards to determining “primary” instead of “sole” regulatory responsibility.
For now, Gosar is solely in charge of the bill. He, however, hopes to “garner some serious support” in the near future. Ben Goldey, Communications Director for Gosar disclosed that they prefer to “gather stakeholder support before working toward cosponsors.”
Crypto regulations, Yes or No?
2019 saw an increase in demand for crypto regulation. Especially after the launch of Facebook proposed stablecoin, Libra Whitepaper. According to Ripple’s Vice President, Breanna Madigan, the thought of Facebook Libra going live placed regulators on their toes. And propelled the call for crypto regulations not just in the USA but all over the globe.
Many schools of thought believe the only way digital currencies will attain global awareness and adoption is by regulations.
Crypto Mom, Commissioner Hester Peirce, however, is of the opinion that regulations are stifling crypto growth.
What’s your take on crypto regulation, I would love to hear from you.
View the “Crypto-currency Act of 2020” here.