Senate Agriculture Committee leaders say they have a solution to the need for more oversight in the cryptocurrency space.
Committee Chair Debbie Stabenow, D-Mich., and Arkansas Republican John Boozman, the panel’s ranking member, introduced legislation Wednesday to boost the role of the Commodity Futures Trading Commission over digital commodities like Bitcoin or Ether. Their bill — the Digital Commodities Consumer Protection Act — would amend the definition of “commodity” to allow the cryptocurrencies to fall under CFTC’s jurisdiction, a nomenclature Stabenow said has already been adopted by the courts and the Securities and Exchange Commission.
“We’re just saying that when something is defined and meets the test as a commodity, the folks that regulate commodities should be regulating digital commodities,” Stabenow told reporters Wednesday.
The CFTC currently regulates American derivatives markets, including swaps, options and futures. If passed, the legislation would add cryptocurrency to that mix, which would introduce a new regulatory framework for digital assets.
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The bill also yields to the SEC on securities issues, something Boozman said was an “appropriate balance.”
Aside from moving the digital currencies under the CFTC umbrella, the bill also would require actions to prohibit abusive trading practices and allow CFTC to impose user fees on digital commodity platforms. The legislation also calls for a report “to examine the racial, ethnic, and gender demographics of customers participating in digital commodity markets” and how those demographics will impact CFTC’s rulemaking.
With the number of legislative days quickly diminishing, prospects for the floor consideration of new legislation could be limited. But both Stabenow and Boozman said this was priority legislation for the ag committee.
“This is not a marker bill, this is something we want to get done. I think it’s something we have a good chance of getting done,” he said. “It’s very simple, and with it just going through one committee … it makes it a lot easier than going through three or four committees with jurisdiction in terms of actually getting it passed.”
Stabenow added “it’s not the only piece of the puzzle, but it’s an important one and it’s one we’re responsible for.” She “fully expects” the committee to hold a hearing on the legislation, and “it’s very realistic we could do that in September.”
Sens. John Thune, R-S.D., and Cory Booker, D-N.J., are also original co-sponsors of the legislation.
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