Senate Republicans released a revised draft of major cryptocurrency legislation Monday, incorporating 126 substantive changes requested by Democrats and adding new ethics and banking provisions ahead of a key procedural vote Tuesday.
The Digital Asset Market CLARITY Act would establish a federal regulatory framework for cryptocurrencies and clarify the roles of the Securities and Exchange Commission and Commodity Futures Trading Commission in overseeing digital assets. The legislation had stalled over Democratic concerns about ethics rules and illicit-finance safeguards, while some Republicans and banking groups raised concerns that the bill could increase competition for bank deposits.
Republican Sens. Cynthia Lummis of Wyoming, John Boozman of Arkansas and Tim Scott of South Carolina said the revised text incorporates 126 substantive changes made during more than a year of bipartisan negotiations. Lummis said the changes address concerns raised by Democrats and called on them to support the legislation.
One of the major changes involves restrictions on cryptocurrency-related financial interests held by federal elected officials, judges and their spouses. The revised provisions were negotiated by Republican Sen. Thom Tillis of North Carolina and Democratic Sen. Ruben Gallego of Arizona and include giving state attorneys general additional authority to enforce the restrictions. President Donald Trump agreed to key portions of the ethics proposal.
The legislation also includes new protections for bank deposits, consumer protections involving affiliate trading, clarification of state consumer protection laws and protections for blockchain software developers, according to the Republican senators.
The banking industry, however, continues to object to provisions allowing cryptocurrency companies to offer rewards connected to dollar-backed stablecoins. Banking groups have argued that such provisions could encourage consumers to move deposits away from traditional financial institutions.
The crypto industry has spent millions of dollars lobbying for the legislation, arguing that a clear federal regulatory framework would provide greater certainty for digital-asset companies and investors. Banking groups have also mounted a lobbying campaign against provisions they say could disrupt the traditional banking system.
The Senate is scheduled to hold the procedural vote Tuesday. The vote requires 60 senators to advance the legislation, meaning Republicans will need Democratic support to move the bill forward.
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