On Tuesday, the US Senate Banking Committee’s digital assets subcommittee is scheduled to hear testimony from former regulators and industry leaders in consideration of legislation to establish a digital asset market structure framework.
In prepared testimony for the Tuesday hearing, former Commodity Futures Trading Commission (CFTC) Chair Rostin Behnam said the regulator’s “current trajectory [was] not sustainable” without addressing gaps for cryptocurrencies. He suggested that lawmakers consider market structure requirements focusing on “customer protections, avoidance of conflicts of interest, and market resiliency.”
“[…] I do not believe public interest for digital assets will wane; inaction will only result in greater risk to our financial markets and investors, through lack of market transparency, fraud, market manipulation, corruption, and conflicts of interest,” the testimony reads.
“As the digital asset market continues to weave itself into traditional financial institutions, concerns regarding broader market resiliency and perhaps even financial stability will grow.”
The hearing to consider the market structure framework in the Senate will come as the House of Representatives weighs its own bill, the Digital Asset Market Clarity, or CLARITY Act. The bill moved out of committee in June and is expected to head for a floor vote soon.
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According to Republican leadership on the digital assets subcommittee, any bill to address a crypto market structure should “clearly define the legal status of digital assets,” allocate authority among regulators to prevent “an all-encompassing regulator from emerging,” and focus on protecting those who trade or purchase crypto.
“While the European Union and Singapore have established clear regulations, the US continues to sit on the sidelines while the digital asset industry seeks greener pastures,” said Wyoming Senator Cynthia Lummis, who chairs the digital assets subcommittee. “That changes today.”
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The Senate’s efforts to establish “bipartisan” legislation for a crypto market structure followed many Democrats voting with Republicans to pass a bill to regulate payment stablecoins. On June 17, the chamber passed the Guiding and Establishing National Innovation for US Stablecoins, or GENIUS Act, which will next head to the House for consideration.
Massachusetts Senator Elizabeth Warren, ranking member of the banking committee and a lawmaker critical of US President Donald Trump’s ties to the crypto industry, could address some of the president’s conflicts of interest at the Tuesday hearing. Warren voted against the GENIUS Act and has called out the president regarding his family’s stake and control of World Liberty Financial, also a stablecoin issuer.
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