A new cryptocurrency bill recently introduced in Congress aims to divide oversight responsibilities between the SEC and CFTC, two powerful regulatory bodies.
Proposed by U.S. Representative John Rose from Tennessee, the Bridging Regulation and Innovation for Digital Global and Electronic Digital Assets would create a Joint Advisory Committee dedicated to cryptocurrencies. This initiative would harness insights and expertise from both the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Rep. Rose stated that the current “heavy-handed” approach of regulation through enforcement has not been effective. Instead of competing for authority, the SEC and CFTC should collaborate with private entities to develop a robust framework for digital assets.
The BRIDGE Digital Assets Act suggests including 20 representatives from the cryptocurrency space. The committee would convene at least twice a year and serve for terms of two years. Rep. Rose also indicated the need to investigate how decentralized technology might enhance traditional financial sectors while ensuring investor protection.
Government focus on cryptocurrency legislation
The BRIDGE Digital Assets Act represents yet another effort by U.S. lawmakers to create uniform regulations for the cryptocurrency market. In May, the House of Representatives approved a bipartisan bill to share regulatory authority between the SEC and CFTC.
Although the White House expressed objections to the so-called Financial Innovation and Technology for the 21st Century Act, it has also shown readiness to negotiate on FIT 21 and other cryptocurrency-related legislation.
Both the CFTC and SEC have taken legal action against major players in the crypto space multiple times, highlighting their differing perspectives on the treatment of digital assets.
The differing regulatory approaches are evident in the case of Ether (ETH). SEC Chair Gary Gensler has been noncommittal when asked whether Ether should be classified as a security or a commodity like Bitcoin (BTC). In contrast, CFTC Chair Rostin Behnam has firmly asserted that ETH is a commodity and should be under CFTC jurisdiction.
