A bipartisan pair of senators introduced a bill Tuesday that would give the Commodity Futures Trading Commission additional powers in regulating the cryptocurrency market and classify more cryptocurrencies as commodities rather than securities.
The Responsible Financial Innovation Act, introduced by Sen. Cynthia Lummis, R-Wyo., and Sen. Kirsten Gillibrand, D-N.Y., aims to provide "certainty and clarity to the growing digital asset and blockchain industries," according to a joint news release.
As digital assets have become more popular, the debate as to how regulators should classify them has ramped up. The Securities and Exchange Commission does not consider the two biggest cryptocurrencies — bitcoin and ethereum — to be securities, but there is less certainty regarding smaller cryptocurrencies.
Crypto proponents favor the commodity designation because there are less stringent regulatory requirements associated with it.
The senators said in the news release "that most digital assets are much more similar to commodities than securities" and their bill would assign the CFTC control of the crypto spot market.
"The United States is the global financial leader, and to ensure the next generation of Americans enjoys greater opportunity, it is critical to integrate digital assets into existing law and to harness the efficiency and transparency of this asset class while addressing risk," said Ms. Lummis, one the main crypto supporters in Congress, in the news release.
SEC Chairman Gary Gensler has been critical of cryptocurrencies and has said the marketplace doesn't offer sufficient investor protections. He has also said most digital tokens are securities and should be subject to the SEC's rules.
The bill introduced Tuesday is similar in scope to a bipartisan bill introduced in the House in April. That bill, the Digital Commodity Exchange Act of 2022, authorizes the CFTC to register and regulate trading venues offering spot or cash digital commodity markets as digital commodity exchanges.
Both bills are unlikely to move in this Congress with Democrats, who in general are warier of cryptocurrencies, in control.
