US Senator Renews Effort To Remedy ‘Erratic Regulatory Framework’ For Crypto

US Senator Renews Effort To Remedy ‘Erratic Regulatory Framework’ For Crypto

Two senators in the United States are taking another crack at coming up with a bill for regulating the digital asset industry.

On Wednesday morning, Senator Cynthia Lummis made an appearance on CNBC’s Squawk Box. She is unofficially referred to as the Bitcoin Senator.

In her appearance, she announced that she was once more working with Senator Kristen Gillibrand for passing an updated version of last year’s co-sponsored bill aimed at crypto regulation.

Lummis’ statement

Speaking on CNBC, the Wyoming Republican asserted that moving ahead was important because of the increased economic integration of digital assets.

Lummis later did a follow-up on Twitter where she shared a chart that highlighted some of the bill’s proposals briefly.

The proposals included requiring crypto exchanges to register and two divide the responsibility of regulating the sector between different agencies.

This renewed push at crypto regulation comes when the broader industry is facing a combination of headwinds and tailwinds.

In terms of regulation, lawsuits were launched by the Securities and Exchange Commission (SEC) against two of the biggest crypto exchanges in the market last month, namely Coinbase and Binance.

The lawsuits shocked the entire crypto industry, as more than a dozen crypto tokens were termed as securities, and this sparked concerns about the future of crypto in the US.

Good news

Nonetheless, there has also been some good news for the crypto industry as well, including the application submitted by BlackRock on June 15th for a spot Bitcoin exchange-traded fund (ETF).

After the submission, other companies also joined in with their own ETF applications, including Ark Invest, Valkyrie, and Invesco.

These filings gave the crypto market an uplift and pushed up Bitcoin to highs that it had not recorded since the previous year.

The proposed bill

The bill that was submitted by Lummis and Gillibrand last year was called the Responsible Financial Innovation Act.

According to Lummis, the new version of the bill is essentially a way of dealing with both the good and bad moments happening in the crypto industry.

In its original form, the bill had been aimed at dealing with some of the most difficult issues that the digital assets industry was facing.

This included figuring out how to characterize a token as a commodity and a security, as this would help clarify what regulator would deal with it i.e. whether the SEC or the Commodity Futures Trading Commission (CFTC).

But, the bill had fallen short and the senator had promised that they would come up with an updated draft and also get feedback from the industry and regulators.

Lummis criticized the enforcement approach taken by the SEC in her interview when it comes to regulating the crypto sector.

However, she said that the blame was also on Congress because they had failed to come up with clear rules for dealing with the matter.

Lummis said that both the SEC and Congress were the reason why an erratic regulatory framework exists.

She went on to say that they had considered the agency’s input in determining the definition of a commodity and security.