Analysis: What does the new crypto bill mean for the blockchain ecosystem?

Analysis: What does the new crypto bill mean for the blockchain ecosystem?

Proponents of her case have been working to make the actual transcript of this statement available online. Thanks to the bipartisan efforts of Senators Cynthia Lumis (R-Wyo.) And Kirsten Gillibrand (DN.Y.), there are ground proposals for lawmakers to think about.

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The new crypto bill comes at a time when the growth of the cryptocurrency ecosystem is becoming more complex, with investor protection concerns targeting the average investor arising from a variety of scams and frauds. The bill seeks to address many of the gray areas of the digital currency ecosystem, including the role of taxation, regulatory oversight, and stabilization, to name a few.

The new crypto bill, if approved, would put the United States on a clear path in dealing with digital assets, which are essentially sustainable.

Chris Terry, a BPSAA board member and VP of SmartFi, spoke to the Enterprise Solutions blockchain. News that he believes I amIf passed, the bill would be a surprise to the crypto industry and would clearly put the United States in a leading position.

“What’s interesting about the Lumis-Gillibrand Responsible Financial Innovation Act is that most of the press doesn’t talk about it, like Article 505 – the right to own your own keys or the definition of Article 502 of the Source Code. They discuss Section 805 and even Defi. Digital Yuan In section 603. This shows that these two senators have a deep knowledge of cryptocurrency and blockchain technology. I was really impressed with the bill. The challenge will be for the rest of Congress to work on it. “

Highlights of the crypto bill

Described as a “landmark bill” by Sen. Gillibrand, the crypto bill has many features, including the definition of crypto as a security or product. Over time, American crypto investors and stakeholders often get bogged down in how they should classify the products they are developing, a move that will determine which regulators they will be under.

With the new bill, all token issuers will have clarity about the products they publish, based on a thorough knowledge of “the purpose of the property and the rights or powers it grants to consumers.” The bill exclusively identifies most digital currencies, including Pioneer Bitcoin (BTC), and Ethereum (ETH), as the largest smart contract protocol. Products.

As a commodity, the bill would seek to empower the Commodity Futures Trading Commission (CFTC) as the chief overseer of emerging industries. Proponents of her case have been working to make the actual transcript of this statement available online. Proponents of her case have been working to make the actual transcript of this statement available online. While the bill is not entirely open access for a new entity, the recognition of the CFTC is a major step towards eliminating all forms of confusion.

Scams and frauds are almost always involved in the crypto industry. Trading exchanges such as MtGox and QuadrigaCx have gone bankrupt in several scandalous reports. Although these examples may not necessarily have a direct impact because the exchanges were outside the United States, most serve U.S. customers.

For exchanges incorporated in the United States, the new bill provides for the protection of digital assets in the event of bankruptcy or accident, leading to the inability of the trading platform.

There was a big uproar last year during a debate over the use of the term crypto broker when considering entity tax allowances in the digital currency ecosystem to finance President Joe Biden’s infrastructure bill. The new bill defines protecting wallet service providers and miners from protecting crypto brokers from specific tax reporting requirements.

Another major highlight of the bill is that it exempts transactions of $ 200 or less from tax and at the same time demands “100% reserve, asset type and disclosure requirement for all payment stablecoin issuers”.

Venture funding is a major trend in today’s crypto ecosystem, the new bill also calls for data transparency and disclosure across the board.

Styliana Charalambus, head of investment and market research at Pure, spoke to Blockchain.news in an emailed statement. Charalambus T has commented on the consequences of thisHe also said the bill would require some disclosure to the SEC from companies raising funds through the sale of digital assets.

“The approach will ensure that market participants and our securities regulatory community receive detailed and accurate disclosures about digital assets that are widely traded, but in a way that encourages innovation.”

Extensive effects of crypto bills

The development of the bill may not meet the interests of a few stakeholders, including external claims, but if approved, it would have far-reaching implications for the United States and beyond.

“The bill would also have a calming effect on investors’ fears about a regulatory clampdown on certain projects. Projects that have not yet been adequately decentralized need to file minimum disclosures to the SEC that would be less understandable than the current approach, but would still be helpful to investors, “Styliana added.” Once that project is fully decentralized, reporting requirements will be eliminated. , And reduced compliance costs. In the global scenario, this will allow cryptocurrency exchanges to feel more comfortable with listed projects that have real utility related to cryptocurrency. “

Outside of the United States, too, many countries are shaking up their game by providing adequate regulatory oversight of the crypto ecosystem. Indeed, the recent collapse of Terra’s algorithmic stablecoin has been significantly faster-tracked, leading to the introduction of a comprehensive stablecoin regulation in Japan, the first country to do so.

With the US crypto bill, innovations from the Web3.0 world will not only be encouraged. Galimzhan Pirmatov, chairman of the National Bank of Kazakhstan, recently noted that more countries could finally put their weight behind innovative crypto ecosystems and choose not to miss space innovations.

Photo source: Shutterstock

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