- The United States has introduced a new cryptocurrency market structure draft law after the FIT21 Act.
- The cryptocurrency community highly evaluates this draft as a 'solid start' and an upgrade from the previous bill.
On May 5, the United States House Committee on Financial Services introduced a discussion draft that could become a new cryptocurrency market structure bill if passed.
This draft attempts to clarify some issues raised by SEC enforcement actions under the Biden administration.
For example, the draft clearly states that digital asset sales are not securities if the buyer does not have ownership rights in the issuer's business, profits, or assets.
Source: House Agriculture Committee (Draft excerpt).
A 'Solid Start' for Cryptocurrency Regulation in the US?
Matthew Sigel, VanEck's head of digital research, praised the draft as an upgrade from FIT21 and a solid start.
Source: X
Notably, the draft also defines stablecoin as not a security and exempts non-custodial DeFi protocols.
However, the DeFi exemption does not limit regulators' ability to enforce laws against fraud, misreporting, or market manipulation.
Source: House Committee
This is the second time the US government has attempted to build a cryptocurrency market structure bill after FIT21 (Financial Innovation and Technology for the 21st Century Act).
In May 2024, the FIT21 bill was passed with strong bipartisan support in the House. However, the US Senate has not yet ratified it at this time.
The bill promises to protect consumers and national security.
Justin Slaughter, Paradigm's Vice President of Legal Affairs, said the new cryptocurrency market structure draft will make the Commodity Futures Trading Commission (CFTC) the primary regulator in this space.
"The bill will make the CFTC the primary cryptocurrency regulator, but will maintain SEC jurisdiction until a network achieves decentralization."
The next step for this draft is to receive feedback from stakeholders before being officially introduced in the House.
The House committee will then review and vote if approved. The Senate's decision and the president's action will follow, before the bill becomes law.
Therefore, there may be many changes before this occurs.
