Bitcoin and Ethereum are classified as commodities in the latest US crypto bill.
— Squawk Box (@SquawkCNBC) August 3, 2022
A new crypto bill authored by Democratic Senator Debbie Stabenow and Republican Senator John Boozman identifies Bitcoin and Ethereum as commodities and places the Commodity Futures Trading Commission (CFTC) in charge of the supervision of both assets.
The bill, which received support from Senator Cory Booker and Senator John Thune, holds that supervision of the rest of the crypto market would be split between the CFTC and the US Securities and Exchange Commission (SEC) without clarifying how exactly it would happen. Additionally, exchanges facilitating the trading of Bitcoin and Ethereum in the US would have to be registered with the CFTC.
According to a report by the Washington Post, Senator Stabenow, head of the Senate Agriculture Committee, highlighting the need for transparency and accountability in the crypto markets, said:
“That’s why we are closing regulatory gaps and requiring that these markets operate under straightforward rules that protect customers and keep our financial system safe.”
The latest bill joins that proposed by Senators Cynthia Lummis and Kirsten Gillibrand in June to regulate the crypto markets. Notably, while the Lummis bill also gives substantial oversight of the crypto markets to the CFTC, as it classifies most crypto as commodities, it doesn’t make registering exchanges compulsory.
It is worth noting that the call for crypto regulations in the US has become more rampant following the Terra ecosystem debacle in May. Notably, the US Treasury has called for stablecoin regulation to take precedence, calling for stablecoin rules by year’s end.
As a result of the calls for crypto regulation, the classification of cryptocurrencies and the decision of which regulator should have superior oversight over the emerging markets have become major talking points. Notably, the SEC and the CFTC have argued why they should be the market’s dominant authority. However, the crypto industry continues to lean towards the CFTC, perceiving the SEC as unfriendly and power hungry.