The total market capitalization of the global cryptocurrency market has returned to USD1.1 trillion, despite a bleak performance in June. It’s estimated that one in five Americans has used or traded digital assets. Given the value of this market and the volume of American participation, legislators continue to introduce bills aimed at regulating cryptocurrency markets.
Earlier in June, Senators Kirsten Gillibrand (D-NY) and Cynthia Lummis (R-WY) introduced the Responsible Financial Innovation Act (the RFIA), which proposed to address significant issues arising at the intersection of traditional financial regulation and digital asset innovation across taxation, securities, banking and consumer protection. One method the RFIA proposed to accomplish this was to give the Commodity Futures Trading Commission (the CFTC) clear authority over applicable digital asset spot markets, thereby affecting digital assets that met the definition of a commodity, such as bitcoin and ether.
A bill introduced on August 3– the Digital Commodities Consumer Protection Act of 2022 (DCCPA) – borrowed language from the RFIA but also introduced its own concepts, which could grant the CFTC increased control over this asset class. As discussed below, the DCCPA, introduced by US Senators Debbie Stabenow (D-MI), chair of the Senate Committee on Agriculture, Nutrition, and Forestry, and John Boozman (R-AR), ranking member, along with Senators Cory Booker (D-NJ) and John Thune (R-SD), would aim – like the RFIA – to close regulatory gaps between state and federal regulation of cryptocurrencies, but to varying degrees.
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