New US Crypto Bill Leaked: Bill Goes Hard After DAOs, DeFi, Stablecoins, And Exchanges

Doge Founder Says Leaked Bill Goes Hard After Sh.t Tokens, DAOs, DeFi, Stablecoins, And Exchanges.

The Crypto community tries to understand the repercussions as over 600 pages of the US crypto bill leaked.

Crypto Twitter is currently buzzing with debates and conversations about legal regulations pertaining to the space.

This was after a cache of documents was leaked. Apparently, the 600+ pages of the draft are said to cover the US crypto bill that is currently in preparation. The initial leak was posted by the slam bot.

here you go

(plz RT) pic.twitter.com/UOVhIUiUBu

— slam (@bot_slam) June 7, 2022

Various entities, including Dogecoin co-founder Billy Markus, got hold of the documents and shared their opinions. Billy sent out a Twitter thread to that effect. In his opinion, the bill is designed to be tough on altcoins, DeFi, DAO, Stablecoins, and crypto exchanges. On this, Billy thinks that going hard on exchanges would have a lasting impact on the industry.

He said, “looks like the new US crypto bill that has been leaked goes hard after sh.t tokens, DAOs, DeFi, stablecoins, and exchanges.”

He further said:  “All they really gotta do is go hard after exchanges and the party is over.”

looks like the new US crypto bill that has been leaked goes hard after shit tokens, DAOs, DeFi, stablecoins, and exchanges pic.twitter.com/wjcAUSi3RS

— Shibetoshi Nakamoto (@BillyM2k) June 7, 2022

No More Anonymous Projects

Looking at it from another angle, the bill seems to try to protect crypto users. First off, all crypto entities operating in the space, like DeFi platforms, crypto projects, Exchanges, and DAO, would have to be legally registered.

This means that the industry would no longer see tokens developed by anonymous creators. No more BTC-like tokens. For one, these situations increase the risk of rug pulls that end up with people losing money to scams.

The bill introduces clarity where gray areas have lingered for a long. Exchanges, DAOs, and Stablecoins will have to be registered, failure to which they’ll be taxed.

A number of assets have also been reclassified as commodities. For example, under the CFTC’s guidelines, if profit/revenue, dividends, equity, or debt are involved in dealing with any token, the asset will cease to be a digital asset. If there is any debt, equity, profit revenue, or dividend of any variety, then it is now expressly not a digital asset commodity.

In terms of disclosure, there will be stricter measures that will eliminate any more possibilities of projects created by anonymous characters. The bill also proposes a raise in exchange for compliance costs, which means that investors will have to foot the bill because the platforms will pass the costs over to the customers. New disclosure requirements would make anon-run projects almost impossible to comply with under the law. -Anything that trades 1 digital asset meets the burden of being a digital asset exchange. The current language seems like it would include AMMs.

Where bankruptcy is filed, exchanges will be required to refund the users’ assets as opposed to liquidating them. This is a big win for users. Exchange oversight is going through the roof. Huge increase in compliance costs (so fees would go up) but likely better listing and no trading against their own users. Fee offsetting rules mean exchanges will have to pay the government fees, likely putting costs up.

The bill also requires exchanges to have Terms of Services that users agree to. Users will have to assent to their agreement whenever the exchange updates its source code. Depository institutions will have the freedom to issue stable coins.

Bankruptcy definition changes are a win for users making it clear assets deposited would get returned to users and not liquidated.

However, the bill clearly spells out penalties to be enforced in the event of non-compliance.

Crypto Space “Was Asking For Regulation”

On the other hand, the bill proposes a rise in compliance costs. As usual, businesses tend to pass these extra costs over to the consumer, meaning that crypto exchanges would increase transaction fees on their platforms.

They would also be required to pay taxes from these fees. Basically, in the eyes of the crypto industry, this bill is a double-edged sword.

According to Billy, the crypto market is full of garbage and has a high concentration of scammers. In his view, this space has been asking for regulation. Billy isn’t exactly pro-crypto, despite him being one of the co-founders of DOGE.

NOTE: It’s A Draft Bill

At this point, it’s worth noting that the bill is still in its draft form. As is always the case with bills, lobby groups will get involved in the refining process to come up with a final, all-inclusive bill.

It’s still not clear when the bill will be presented for debate or passing by lawmakers. It’s also not clear who leaked the documents.