U.S. Senators Cynthia Lummis and Kirsten Gillibrand have developed a second draft of their comprehensive crypto regulation bill. Chances are slim that it will, as a single bill, advance to becoming a law, but it may still drive a broader conversation within Congress on what sort of provisions smaller pieces of legislation should include.
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The narrative
The bill introduced last week by Senators Cynthia Lummis and Kristen Gillibrand builds on a first draft introduced a year ago.
Why it matters
While regulators are continuing to try and determine how crypto assets might fall within their various jurisdictions, Congress continues to look at the broader question of whether and what types of new laws might be needed.
Breaking it down
U.S. Senators Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) unveiled a second version of their crypto bill last week, creating a definition for decentralized finance and addressing issues ranging from anti-money laundering provisions to custody rules. The bill also grants the Commodity Futures Trading Commission (CFTC) clearer authority over crypto issuers, giving the Securities and Exchange Commission a defined, but arguably more limited role than it enjoys at present.
It’s not clear to me whether this version of the bill has any greater chance at becoming a law than last year’s version. But it doesn’t have to become a law to be a success. This is a comprehensive bill – if other lawmakers decide to borrow parts, or at least look at parts while they consider their own legislation, this bill could still drive the conversation in D.C., such as it is.
Of course, the biggest hurdle the lawmakers face is their fellow lawmakers: Congress as a whole has shown not much appetite for passing any crypto-specific legislation into law in the current climate, though bills continue to be introduced.
The House Financial Services Committee may be the closest to moving any legislation, with markups anticipated on the stablecoin and market-structure bills currently introduced to that body.
The bill itself addresses a wide swath of the crypto industry’s biggest questions. Perhaps the most important details are…
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