After last week’s defeat, the cryptocurrency market was mixed.
The price of bitcoin gained 1.6% and the price of ethereum rose by a few basis points this week. cardano
Meanwhile, last Tuesday, Republican Cynthia Lummis and Democrat Kirsten Gillibrand introduced what many call a “landmark” cryptocurrency bill. named the Responsible Financial Innovations ActThe bipartisan legislation finally aims to clarify the biggest regulatory issues that hang over digital assets.
“The bipartisan Responsible Financial Innovation Act is a bill that will establish a regulatory framework that encourages innovation, develops clear standards, sets appropriate jurisdictional boundaries and protects consumers. Importantly, the Lummis-Gillibrand framework will provide clarity to the industry and regulators, while also maintaining the flexibility to take into account the continuing evolution of the digital asset market,” said Senator Gillibrand
[Ed note: Investing in crypto is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Here is a summary of some of the key provisions of the legislation.
- O Responsible Financial Innovation Law seeks to classify digital assets into bonds and commodities and regulate them accordingly. This “will give digital asset companies the ability to determine what their regulatory obligations will be and give regulators the clarity they need to enforce existing securities and commodities trading laws.” For example, bitcoin and ether, which fall under the “commodity” category, would be regulated by the Commodity Futures Trading Commission (CFTC).
- The project would ease the tax burden for cryptocurrency holders and miners. Small purchases of up to $200 would no longer need to be reported to the IRS, which would facilitate cryptocurrency transactions. It also “disqualifies” miners as brokers seeking to exempt their holdings from taxation until they “redeem in cash”.
- On the anti-crypto side, Lummis and Gillibrand want to root out algorithmic stablecoins that are not backed by “TradFi” assets such as gold or fiat currencies. “Lummis-Gillibrand establishes 100% reserve, asset type and detailed disclosure requirements for all payment stablecoin issuers. This ensures that a payment stablecoin holder can always redeem the stablecoin in exchange for the equivalent dollar value, which maintains its value and protects consumers from many of the potential risks associated with stablecoins,” the press release wrote.
O Responsible Financial Innovation Law it’s a landmark still very early step in building a clear regulatory framework for crypto. The bill will have to survive a series of hearings and debates in the Senate before being brought to a full vote.
Many political experts believe there is no chance of going anywhere before the end of this year. And given its scope, there is a high possibility that it will be heavily revised or split into smaller accounts.
Still, the Lummis and Gillibrand effort is shaping up to be one of the most sweeping – and largely pro-crypto – legislation to date, which is crucial to the widespread adoption of digital assets and their integration into traditional finance.
As Diogo Monica, co-founder of institutional digital asset platform Anchorage, said in an interview with CNBC, “What is bad for cryptocurrency is the lack of regulation and enforcement, and any kind of regulation, even strict, is welcome. by the industry.
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