Representatives from the White House are poised to vote on a bill granting authority to the Commodity Futures Trading Commission (CFTC) to regulate cryptocurrencies under commodities rules.
The CFTC currently oversees U.S. derivatives markets, including crypto futures, treating cryptocurrencies as commodities to safeguard against fraud and manipulation while fostering innovation through appropriate regulation. However, its regulatory reach within the crypto sector remains limited, relying on traditional rules and laws.
According to a recent report by a16zCrypto, the White House representatives are set to vote on bill HR 4763 by the month’s end. This legislation aims to empower the CFTC with clear rules and laws to regulate cryptocurrency projects and companies dealing with commodities or digital assets deemed commodities.
Under the proposed bill, the CFTC would classify a digital asset as a commodity if it demonstrates functionality and decentralization. Conversely, the United States Securities and Exchange Commission (SEC) would categorize a digital asset as a security if its associated blockchain is functional but lacks decentralization.
Decentralization, as defined in the bill, refers to the absence of unilateral control over the blockchain or its usage by any single entity, and no issuer or affiliated party possessing 20% or more control over the digital asset or its voting power.
The upcoming vote on bill HR 4763 by the U.S. House of Representatives will be pivotal. It aims to clarify crypto regulations, with the CFTC focusing on functional and decentralized digital assets, while the SEC addresses those deemed securities.
The response from U.S. crypto law experts will be closely watched, as this bill promises clarity in crypto regulations but may also face scrutiny from various stakeholders within the crypto industry.
In the past, numerous top crypto companies have voiced concerns over unclear regulations. Critics argue that the SEC oversteps its authority in regulating the crypto sector, despite lacking explicit jurisdiction.
Unclear regulations create challenges for crypto businesses, making it difficult to operate in a hostile regulatory environment.
Source: cryptodaily.co.uk
