Senator Cynthia Lummis says the recent ruling in the Ripple case has further underscored the need for Congress to create a comprehensive crypto regulatory framework.
In a recent tweet, Cynthia Lummis, a US Senator from Wyoming, expressed the urgent need for Congress to establish a comprehensive regulatory framework for crypto assets. The catalyst for her call was the Ripple decision, which has raised concerns about the lack of clear guidelines surrounding digital currencies.
Teaming up with Senator Kirsten Gillibrand from New York, Lummis unveiled the Lummis-Gillibrand bill, touting it as the most comprehensive and bipartisan proposal to address the digital currency space.
The Ripple decision has reinforced the need for Congress to create a regulatory structure for crypto assets.
Lummis-Gillibrand is the comprehensive, bipartisan bill that protects consumers while allowing the industry to continue to drive the innovation our economy needs.
— Senator Cynthia Lummis (@SenLummis) July 25, 2023
The Reworked Bill
The Lummis-Gillibrand bill builds on the earlier version they introduced months before the collapse of FTX in 2022, aiming to protect consumers while fostering innovation in the industry.
“We can put sufficient consumer protections and safeguards on this industry so that something like the failure of FTX would likely not happen in the United States,” Lummis remarked in an interview, “We know how to regulate it. We know how to safely define what is a commodity and what is a security.”
Central to their proposal is the clear differentiation between securities and commodities, with enforcement authority assigned to the appropriate regulatory bodies.
The bill entrusts the SEC to play a more proactive role in safeguarding consumers and imposes disclosure requirements on companies. Furthermore, crypto exchanges must register with the Commodities Futures Trading Commission (CFTC) to maintain transparency and accountability under the new bill.
The two Senators expressed confidence in the SEC and CFTC’s capability to handle their role in the crypto industry to ensure compliance and growth. Senator Lummis noted that their approach had been carefully vetted through consultations with industry experts and regulators, indicating a broad consensus for moving forward.
Regulatory uncertainty has raised fears that crypto companies might seek friendlier jurisdictions abroad, potentially losing business from the United States.
According to an NBC report, JPMorgan had urged lawmakers to establish a comprehensive framework for regulating the crypto industry and clarify the SEC’s and CFTC’s responsibilities.
While Lummis and Gillibrand’s bill gains traction, it is not the only option on the table. As The Crypto Basic disclosed, Congressman Patrick McHenry, Financial Services Committee Chairman, introduced a draft to provide cryptocurrency regulations.