WASHINGTON–An initial discussion draft of digital asset market structure legislation covering issues under the jurisdiction of the Senate Banking Committee has been released in the wake of the passage of the CLARITY and GENIUS acts.
Those pieces of legislation seek to create a regulatory framework for cryptocurrency.
The committee has issued a Request for Information (RFI) for stakeholders to submit feedback on the draft and on a wide range of questions.
“My colleagues and I in the House and Senate share the same goal: to provide clear rules of the road for digital assets that protect investors, foster innovation, and keep the future of digital finance anchored in America. I’m grateful for the hard work of our House counterparts to craft smart, bipartisan legislation, and I look forward to building on their work here in the Senate,” said Chairman Tim Scott (R-SC) in a statement.
What’s Included
According to Scott’s office, the discussion draft takes steps to:
- Define Ancillary Assets. The discussion draft clearly defines an “ancillary asset” to clarify which digital assets are not securities.
- Create Disclosure Requirements. The discussion draft creates disclosure requirements that are tailored for offers, sales, or distributions of ancillary assets.
- Promulgate New Rules. The discussion draft requires the Securities and Exchange Commission (SEC) to promulgate new rules:
- Regulation DA: To exempt certain offers or sales of ancillary assets from SEC registration, including offers of sales that do not exceed $75 million in gross proceeds per year over four years.
- Investment Contracts: To more clearly define what constitutes an investment contract.
- Modernize Securities Regulations. The discussion draft directs the SEC to tailor existing requirements to digital asset activity, so that regulations are no longer outdated, unnecessary, or unduly burdensome in light of the unique technological characteristics of digital assets.
- Prevent Illicit Finance. The discussion draft requires the creation of examination standards for digital assets and encourages private sector entities to partner with federal law enforcement, to detect and deter illicit finance.
- Promote Responsible Banking Innovation. The discussion draft ensures financial holding companies can use a digital asset or distributed ledger system to perform, provide, or deliver any activity, function, product, or service that banks are otherwise authorized by law to perform, provide, or deliver.
For the full text of the discussion draft, click here.
