Coinbase Calls on Congress to Bring Clarity to Crypto
Cryptocurrency exchange Coinbase is calling on lawmakers to establish regulations for the digital asset industry.
“Blockchain technology and digital assets are reshaping the global economy, bringing opportunities for innovation, financial inclusion, and economic growth,” the company wrote on its blog Wednesday (Feb. 19). “Yet, the absence of clear legislation in the United States stifles this potential, leaves consumers exposed, and drives innovation overseas.”
Among the legislative priorities outlined by Coinbase is a law that clearly designs digital assets in a way that distinguishes between securities, commodities and other types of tokens.
It also says the legislation should give the Commodity Futures Trading Commission (CFTC) the power to oversee the crypto spot market, “ensuring transparency and protecting consumers from fraud and manipulation.”
In addition, Coinbase says Congress should require the Securities and Exchange Commission (SEC) to create rules “allowing responsible fundraising while protecting investors,” arguing that developers need a way to “raise capital for blockchain projects without every token being treated as a security.”
Coinbase also wants Congress to establish a framework for stablecoins, to ensure these currencies are “safe, fully backed, and transparent while fostering competition and innovation in the marketplace.”
The company’s call for legislation comes as lawmakers are introducing bills that would govern the stablecoin space.
For example, Republican Reps. French Hill (AR) and Bryan Steil (WI) earlier this month introduced a discussion draft for a bill that would create a framework for issuing and operating dollar-denominated payment stablecoins.
The proposal builds on past legislative efforts while attempting to establish clear regulatory guidelines for stablecoin issuers at the federal and state levels.
“Building upon our work on digital assets in the last Congress, our discussion draft will provide clarity for payment stablecoins and ensure a federal and state path for stablecoin issuers,” said Hill, chair of the House Financial Services Committee.
On the other side of the aisle, Rep. Maxine Waters, the ranking Democrat on the committee, introduced a bill last week that would establish a comprehensive regulatory framework for payment stablecoins.
“At the heart of the bill from Waters is a requirement that all stablecoin issuers be either a registered payment stablecoin issuer, a licensed nonbank entity, or a subsidiary of an insured depository institution,” PYMNTS wrote. “Unregistered or unlicensed entities would face stiff penalties, including fines of up to $1 million per violation and imprisonment of up to five years.”
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