LONDON (Bywire News) - As the US senate continues to try and find an effective regulatory response to cryptocurrencies a new bill is being introduced which would make the Commodity Futures Trading Commission (CFTC) the direct regulator of the largest cryptocurrencies in the industry.
Introduced by top Democrats and Republicans on the Senate Agriculture Committee, the measures would give the derivatives regulator exclusive jurisdiction over Bitcoin and Ethereum, the two largest cryptocurrencies, as well as other products which have been determined to be commodities.
The rules would require crypto providers such as brokers, custodians, and exchanges to register with the CFTC. The registration would align with requirements that maintain fair pricing, prevent market manipulation, avoid conflicts of interest and maintain “adequate financial resources” according to a description of the bill provided by senators.
Those sponsoring the measure include the Chairwoman of the Senate Agriculture Committee Debbie Stabenow and Sen. John Boozman, the panel’s top Republican who argued that it would provide much-needed clarity to the crypto market by positioning a large sector of the industry under a single regulator.
Boozman added in a statement “This fast-growing industry is currently governed largely by a patchwork of regulations at the state level. That simply is not an effective way to protect consumers from fraud.”
The bill joins a list of legislations aimed at trying to find common ground for crypto rules. Lawmakers in both the House and Senate are working on measures that place guardrails around a market that is known for its volatility and has suffered a number of high-profile failures in recent months.
Stabenow told reporters that the bill isn’t intended to cover the whole market or undermine the work of the SEC to police crypto products that act as securities.
"We're not defining what security is. I have great confidence in Chairman Gensler to be able to use his authorities," she said.
Whilst the window for legislative action is narrowing amid the November midterm elections, Stabenow and Boozman both insisted that they wanted to move ahead with the legislation as soon as possible, without laying out a precise timeline.
(Writing by Samba Jallow, editing by Klaudia Fior and Tom Cropper)