The US Senate Agriculture Committee has released its highly anticipated discussion draft of crypto market structure laws, moving Congress closer to passing legislation outlining how the crypto industry will be regulated.
Republican Agriculture Chairman John Boozman and Democratic Sen. Cory Booker released the draft Monday, which includes brackets around sections of the bill that lawmakers are still negotiating.
The bill seeks to define limits on the power of the Commodity Futures Trading Commission and the Securities and Exchange Commission to regulate crypto. Only Congress can set agencies’ regulatory limits, and both have shared advice with businesses on crypto amid the Trump administration’s deregulation.
“The CFTC is the ideal agency to regulate spot trading in digital commodities, and it is essential to establish clear rules for the emerging crypto market while protecting consumers,” Boozman said.
Booker said the draft discussion would “give the CFTC new authority to regulate the digital commodities spot market, create new protections for retail customers, and ensure the agency has the staff and resources necessary to oversee this growing market.”
Some parts of the crypto invoice still need to be modified
The bill describes common cryptographic terms such as “blockchain,” “decentralized finance,” and decentralized autonomous organizations and how they would be regulated under the Commodity Exchange Act.
Much of the bill is in parentheses, indicating it is subject to change. Part of the text mentions the “minority view” – held by Democrats on the committee – who does not believe the Agriculture Committee has jurisdiction over certain aspects and wants to work with the Senate Banking Committee to “address issues related to non-controlling blockchain developers and blockchain service providers.”
The Agriculture Committee has jurisdiction over the CFTC, and the Senate Banking Committee is leading parts of the securities law bill because it oversees the SEC.
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Banking Committee Republicans released a discussion draft of their section of the bill in July and suggested it would marry with the CLARITY Act, a bill passed by the House in July that gives the CFTC a central role in crypto regulation.
Crypto groups back down
Ji Hun Kim, CEO of cryptocurrency advocacy group Crypto Council for Innovation, said the release of the bill “marks positive and significant progress toward establishing a comprehensive and responsive market structure framework for digital products in the United States.”
Mason Lynaugh, community director of Coinbase’s lobbying arm, Stand with Crypto, said the bill is an “important step toward formally establishing the common-sense regulatory framework” that the crypto industry has been calling for.
“The Senate must move quickly and deliberately to pass market structure legislation,” he added. “Nationwide crypto advocates are counting on their elected officials to create clear rules of conduct.”
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