Rep. Don Beyer (D-VA), the Chairman of Congress’ Joint Economic Committee and author of the Digital Asset Market Structure and Investor Protection Act today issued the following statement as the House Financial Services Committee held a hearing on digital assets:
“I commend Chair Waters and the House Financial Services Committee for their work on digital assets to explore legislative solutions that promote innovation and growth while protecting consumers. My comprehensive digital asset legislation is an excellent starting point for those efforts. I look forward to continued conversations with Chair Waters and other members of the Committee on how Congress can incorporate digital assets into regulatory frameworks, a need that both industry and regulators emphasize more and more all the time,” said Beyer.
Beyer recently chaired a Joint Economic Committee hearing “Demystifying Crypto: Digital Assets and The Role Of Government.” The hearing underscored the important point that, while digital assets have great potential, the lack of comprehensive regulation exposes investors and consumers to fraud, hacks, and other illicit activities. Federal regulators have called upon Congress to create better rules to govern digital assets.
The Digital Asset Market Structure and Investor Protection Act (text here) would protect consumers and promote innovation by incorporating digital assets into existing financial regulatory structures:
- Creating statutory definitions for digital assets and digital asset securities and providing the Securities and Exchange Commission (SEC) with authority over digital asset securities and the Commodity Futures Trading Commission (CFTC) with authority over digital assets;
- Providing legal certainty as to the regulatory status for the top 90% of the digital asset market (by market capitalization and trading volume) through a joint SEC/CFTC rulemaking;
- Requiring digital asset transactions that are not recorded on the publicly distributed ledger to be reported to a registered Digital Asset Trade Repository within 24 hours to minimize the potential for fraud and promote transparency;
- Explicitly adding digital assets and digital asset securities to the statutory definition of “monetary instruments,” under the Bank Secrecy Act (BSA), formalizing the regulatory requirements for digital assets and digital asset securities to comply with anti-money laundering, recordkeeping, and reporting requirements;
- Providing the Federal Reserve with explicit authority to issue a digital version of the U.S. Dollar, clarifying that digital assets, digital asset securities and fiat based stablecoins are not U.S. legal tender, and providing the U.S. Treasury Secretary with authority to permit or prohibit US Dollar and other fiat-based stablecoins;
- Directing the Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), and Securities Investor Protection Corporation (SIPC) to issue consumer advisories on “non coverage” of digital assets or digital asset securities to ensure that consumers are aware that they are not insured or protected in the same way as bank deposits or securities; and,
- Requiring legislative recommendations from FinCEN, SEC and CFTC to provide clarity on dividing lines between who must register as a money services business versus who must register as a securities or commodities exchange.