Sens. Kirsten Gillibrand (D-N.Y.) and Cynthia Lummis (R-Wyo.) introduced legislation on Tuesday that will create a regulatory framework for digital assets such as cryptocurrency.
The Responsible Financial Innovation Act (RFI) will encourage innovation in the financial sector, as well as flexibility, transparency and robust consumer protections while integrating digital assets into existing laws.
The proposed legislation will also assign regulatory authority over digital asset spot markets to the Commodity Futures Trading Commission (CFTC), which regulates commodities markets, creating a new advisory committee that will focus on developing guideline principles, empowering regulatory agencies and advising lawmakers on fast-developing technology.
The lawmakers also said the RFI bill will create a workable structure for the taxation of digital assets and cryptocurrencies and will provide a regulatory sandbox for state and federal regulators to collaborate on innovative financial technologies among other provisions, according to the statement.
This comes as lawmakers have been trying to figure out ways to regulate cryptocurrency without affecting it greatly, as the crypto industry has looked into this type of legislation as a way for federal regulators to update the ways they oversee the financial system which will benefit cryptocurrencies and exchanges.
Gillibrand and Lummis first announced their bipartisan effort earlier in March, as both lawmakers serve on the Senate’s Agriculture and Banking committees.
“Digital assets, blockchain technology and cryptocurrencies have experienced tremendous growth in the past few years and offer substantial potential benefits if harnessed correctly. It is critical that the United States play a leading role in developing policy to regulate new financial products, while also encouraging innovation and protecting consumers,” Gillibrand said in a statement, adding that the bill will spark innovation and develop clear standards, define jurisdictional boundaries and protect consumers.
“Importantly, the Lummis-Gillibrand framework will provide clarity to both industry and regulators, while also maintaining the flexibility to account for the ongoing evolution of the digital assets market,” Gillibrand added. “I am proud to introduce this bipartisan bill with Senator Cynthia Lummis, who has been a passionate and engaged partner, and look forward to working alongside her to build support.”
“The United States is the global financial leader, and to ensure the next generation of Americans enjoys greater opportunity, it is critical to integrate digital assets into existing law and to harness the efficiency and transparency of this asset class while addressing risk. My home state of Wyoming has gone to great lengths to lead the nation in digital asset regulation, and I want to bring that success to the federal level,” Lummis said in a statement. “As this industry continues to grow, it is critical that Congress carefully crafts legislation that promotes innovation while protecting the consumer against bad actors.”