The bipartisan bill on crypto regulation released on Tuesday already raises many a doubt in investors’ mind. At the centre of the bill’s recommendations is the plan to regulate various cryptocurrencies in separate categories.
Disclosure Needs To Kill Altcoins?
It proposes to bring crypto under the purview of the Commodity Futures Trading Commission (CFTC), instead of the Securities and Exchange Commission (SEC). The bill also plans to introduce strict registration and disclosure requirements on crypto companies. This could prove to be a huge roadblock for the existing altcoins.
Meanwhile, senators Cynthia Lummis and Kirsten Gillibrand are positive about the passing of the bill through all stages of jurisdiction.
Speaking on Fidelity’s announcement last month on allowing users to put their retirement funds in Bitcoin, Lummis said it was a wonderful idea. Bitcoin could play the role of a long term part of retirement funds, which helps in diversified asset allocation, she added.
“Investors need some assets as just a store of value and that is where Bitcoin shines. For that reason it belongs as a slice of the diversified asset allocation for retirement funds.”
Crypto Regulation Must For Consumer Protection
Senator Kirsten Gillibrand said the most important goal of the legislation was to create transparency, accountability and certainty. When we met the industry leaders, they wanted to know the rules and the roles of various regulators, she added. Speaking to CNBC on the crypto bill, she added,
“We aligned the regulatory framework based on each cryptocurrency’s purpose. Our goal is to take the crypto bill through the four committees of jurisdiction. Regulation is necessary. You need to make sure that you have consumer protections. You need basic rules of the road.”
The two senators played a vital role in drafting the bill over the last few months. They said the focus is on bridging the digital asset world with the existing regulatory framework. “There will be four committees involved in the bill. We want to sort out how the bill can be divided throughout the committees.”
Microstrategy CEO Michael Saylor also voiced his opinion on the positive impact of regulation on Bitcoin. He said the top cryptocurrency will benefit from regulatory clarity, which will facilitate and accelerate the participation of institutions. Participation of traditional banks, public companies, and institutional investors will increase, growing the entire digital assets industry, he added.
On the other side, Peter Schiff, the CEO and chief global strategist of Euro Pacific Capital, had a contrasting argument. He said the bill was not good news as one of the main selling points of Bitcoin is an absence of regulation.
“Pumpers in the crypto industry are in complete denial insisting that increased government regulation is bullish for Bitcoin. How can more regulation be a positive when one of the main selling points of Bitcoin is an absence of regulation relative to traditional payment methods?”
The crypto bill comes at a time when supporters of Bitcoin are increasingly becoming influential in the U.S.. However, the release of draft cryptocurrency bill doesn’t indicate a definite timeframe for its passing.
In a latest comment on the state of crypto regulation, Senator Lummis on Tuesday said the existing laws are outdated. She said the 21st century blockchain technology is facing 20th century regulations. More than 34 million Americans report owning some form of digital assets, she added.
“We are regulating this 21st century technology with 20th century regulations. It’s time for an upgrade, and the Lummis-Gillibrand plan accomplishes that.”
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