The bitcoin price has helped the broader crypto market—including ethereum, BNB, XRP, solana, cardano and dogecoin—to rally despite a serious warning some other cryptocurrencies could go the same way as the experimental stablecoin terraUSD and its support coin luna.
Now, a Senate committee has introduced a bill that would give the Commodity Futures Trading Commission (CFTC) “exclusive” oversight over a newly-created asset class called digital commodities that includes bitcoin and ethereum while excluding other cryptocurrencies deemed securities—a tighter definition than other proposed crypto bills.
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The Digital Commodities Consumer Protection Act of 2022, introduced by the Senate Agriculture Committee this week, would see the CFTC regulate spot markets for digital commodities, amending the Commodity Exchange Act without going as far as to define which cryptocurrencies are securities.
The Agriculture Committee is expected to hold a hearing on the bill as early as September, according to comments made by Democrat Senate Agriculture Committee chairwoman Debbie Stabenow of Michigan and reported by the Wall Street Journal.
“These rules hold digital commodity platforms to the same standards as traditional financial institutions,” the Senate committee said in a statement. “Without appropriate oversight, customers will continue to be vulnerable to fraud and manipulation, and market participants will lack the regulatory certainty necessary to innovate and grow.”
In recent months, the battle among U.S. federal agencies and congressional committees over who will regulate the red-hot crypto market has intensified. The U.S. Securities and Exchange Commission (SEC) and Federal Reserve have both lobbied for oversight of crypto, potentially increasing their budgets and clout.
The debate over whether some cryptocurrencies should be considered securities has been set alight by the SEC after it branded a handful of digital currencies securities as part of an insider trading case brought against a former product manager at the crypto exchange Coinbase.
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Meanwhile, the have been a flurry of bills introduced over recent months in an attempt to draw jurisdictional lines around cryptocurrencies. The huge crypto price crash this year—wiping $2 trillion from the combined value of top ten coins bitcoin, ethereum, BNB
This week, the newly-sworn in CFTC commissioner Caroline Pham pushed back against claims the regulator cannot police digital markets, telling Forbes, “it’s really important that people understand that the CFTC regulates not only the most complex products in the world.”
“The CFTC has brought more than 50 enforcement actions in the crypto space since about 2015, when we first came out with our action that said that bitcoin was a commodity,” Pham said.