The new crypto bill includes definitions and classifications for different digital assets, as well as considerations for regulators.
The US Congress, the responsible entity for writing laws at the federal level, is preparing a bill entitled “Cryptocurrency Law 2020”, with which it will seek to establish a clear legal framework that will form the basis for the next regulations applicable to the approach of digital assets.
According to information published by several news portals, one of the main properties of this bill is the fact that it will incorporate protocols and definitions for the different digital assets, handling different categories and contemplating a series of specifications for each case.
Crypto Bill: Classification for digital assets
This bill includes three definitions:
- Crypto Commodities:
Digital assets understood as an economic good or service with a fungible nature, which can operate in the markets without considering who the issuer is.
- Crypto Securities:
Related to all Blockchain-based digital assets that represent derivatives, stocks and/or debt instruments.
- Cryptocurrencies (Cryptocurrencies):
Digital representation of the US currency or its derivatives, which operate in a block network and are backed by fully guaranteed reserves in a bank account (stablecoins) or by smart contracts that host Crypto Commodities or Crypto Securities.
Responsibilities of federal regulators
On the other hand, the bill also establishes considerations regarding the duties, rights and responsibilities destined for federal regulators regarding the treatment of cryptocurrencies.
The proposal would especially empower three regulatory bodies: The Securities and Exchange Commission (SEC), the Financial Crimes Enforcement Network (FinCEN) and the Commodity Futures Trading Commission (CFTC), bodies responsible for carrying out the supervision of digital assets throughout the country, each from its field of competence operating under the guidelines of a regulatory entity at the federal level.
The aforementioned entities must publish detailed listings with the applicable regulatory requirements for all crypto market participants in the US, and must work in an articulated manner to ensure a much more solid approach in this area.
This news generated diverse reactions among the participants of the ecosystem throughout the country, who requested greater clarity from each of the states in regulatory matters, as well as unique criteria applicable in all respective jurisdictions.
However, many recognize the importance of this first step to help the United States in the way of establishing much clearer and more united criteria in this matter, clarifying the legal treatment that will apply for each type of digital asset according to its characteristics and taking care that operating companies are subject to sanctions that are freely interpreted by regulatory bodies.