Latest news with #DigitalAssetMarketClarityAct
Yahoo
4 days ago
- Business
- Yahoo
House Dems Get Bonus Hearing on Crypto Market Structure, Assail Trump Conflicts
WASHINGTON, D.C. — U.S. President Donald Trump's crypto ventures were once again under the microscope during a House Financial Services Committee hearing that otherwise saw legal experts express worries about how regulators might police digital assets under a market structure bill. The committee held a "minority day" hearing — meaning the witnesses were primarily picked by the Democrats, the current minority party in the House — on Friday, letting lawmakers ask questions more targeted on concerns they have with the Digital Asset Market Clarity Act, the Republican-led market structure legislation that will receive a markup vote next week. Maxine Waters, the ranking Democrat on the committee who'd demanding this extracurricular hearing after the panel met earlier in the week on the same topic, pointed to Trump's various crypto efforts in her opening statement, saying her goal was to stop Trump from profiting off of his crypto ventures to the extent he has been. "What I'm opposed to in this act … is the crooked president of the United States of America, who's decided to use the office of the presidency to enhance his access to profits," Waters said. Republicans focused on a different tack: "Currently, there is no federal framework for non-security digital assets," Committee Chair French Hill said in his own opening statement, a stance echoed by his colleagues Bryan Steil and Warren Davidson. They contend that Democrats and the administration of former President Joe Biden allowed years to pass in which they failed to protect consumers by offering no rules to oversee crypto. Crypto has driven an ideological wedge into the Democratic Party on Capitol Hill, with many Democrats — typically skewing toward the younger members — supporting the advancement of digital assets legislation despite the direction of their leadership. Most of the Democrats attending this bonus hearing on the Clarity Act were in the crypto-critical camp, though Representative Jim Himes, a Connecticut Democrat, has supported crypto bills in the past and questioned witnesses at the hearing about his concerns that the bill may include loopholes that could allow financial firms to dodge oversight. Himes, a yes vote on last year's predecessor to the Clarity Act — the Financial Innovation and Technology for the 21st Century Act, or FIT21 — said some of the provisions in the new effort may allow for a carveout that can be abused by certain types of issuers under Securities and Exchange Commission regulations. The Clarity Act itself is more complicated than it needs to be and does not address some of the cybersecurity risks posed to the cryptocurrency industry, said Carole House, a former White House adviser who is now a senior fellow at the Atlantic Council GeoEconomics Center. She pointed to recent crypto hacks, including crypto exchange ByBit, as an example. Amanda Fischer, policy director at Better Markets, a Washington group advocating for financial policies that favor the public, said her bigger issue was with the exceptions that exist for companies to seek regulation under the Commodity Futures Trading Commission rather than the Securities and Exchange Commission, saying that it might provide loopholes for issuers or other crypto companies that otherwise would be regulated under the SEC and be subject to securities registration and reporting requirements. But as has been seen in other recent hearings, Trump's crypto ties again reappeared as the star of the show. Bart Naylor, a policy expert at Public Citizen and a former investigator for the Senate Banking Committee, said he believes Trump is specifically soliciting gifts through his memecoin and selling favors through actions like his memecoin dinner or by terminating SEC lawsuits against companies which donated money to him. White House officials have routinely denied Trump is exhibiting a conflict of interests in his pursuit of digital assets business gains. Waters had staged a walkout last month from what was meant to be a joint hearing of this and the House Agriculture Committee on crypto policy, though industry insiders were careful to note that not all the panel's Democrats followed Waters' departure.
Yahoo
6 days ago
- Business
- Yahoo
Trump's Crypto Ties at Forefront as U.S. Lawmakers Weigh Crypto Market Structure Bill
U.S. House of Representatives Republicans are forging ahead with legislation to establish regulations for U.S. crypto markets, dissecting that effort in a pair of hearings on Wednesday, but Democrats insist the complex bill is hurried, flawed and fails to address a chief complaint: their accusations that President Donald Trump is engaged in crypto corruption. The House Financial Services Committee and House Agriculture Committee both examined the changes contemplated by Digital Asset Market Clarity Act, with witnesses in the financial committee including two former chairmen of the Commodity Futures Trading Commission and a former acting chairman of the Securities and Exchange Commission. Republican lawmakers praised the bill as an urgently needed, long-awaited answer to both the digital assets industry's desperation for clear rules and also to the concerns that crypto innovations will continue to flee overseas if the U.S. fails to match the regulatory work that's moved far ahead in other jurisdictions, including in Europe and Asia. "This is the future, and we better get our act together," said Representative Bill Huizenga, the vice chairman of the House Financial Services Committee, who argued the status quo is offering consumers zero protections. Crypto bills in both the House and the U.S. Senate in this and the previous congressional session have cleared multiple voting tests to demonstrate significant bipartisan support. However, Democratic lawmakers who have been among those yes votes in committees and on the House and Senate floors have suggested that the potential conflicts-of-interest demonstrated in President Donald Trump's personal crypto business interests must be addressed to maintain that support. Representative Jim Himes, a Connecticut Democrat who was once a banker at financial giant Goldman Sachs Group Inc., said he's in that category. "The way to deal with the Trump stuff is to make sure that this bill has — literally — platinum consumer protections," he said, citing money-laundering constraints and also conflict-of-interest language for public officials. "I will not vote yes on this thing unless it does." Democrats have openly accused Trump of corruption in his crypto dealings, in which he and his family are reportedly collecting millions in profits and fees from the industry — including anonymous foreign investors — as the federal government debates how to regulate those same activities the Trumps are involved in. Almost all the Republicans on the financial-services panel maintained a distance from the Democrats' chief complaint, only mentioning Trump's name when praising his administration for its crypto support. Then Representative Andy Barr of Kentucky leapt into the fray directly, admonishing the Democrats' "carelessly thrown-out accusation and this baseless politically motivated attack against President Trump." "They know that the president's assets are in a blind trust managed by his children who are not members of the administration," Barr contended, though blind trusts are formal agreements that leave their beneficiaries with no knowledge of their investments — not a description of Trump's relationship with his family business. The lawmaker said the Democrats' opposition is "about them opposing American leadership in crypto." Himes criticized Barr's "ill-advised and cheap shot that we are engaging in politics." Democrats also raised other issues with the 236-page Clarity Act, arguing that they haven't had enough time to get a handle on the hugely complex legislation, that it doesn't focus enough on protections for consumers, falls short on dealing with crypto in illicit finance and potentially leaves loopholes for existing securities firms to use the new rules to dodge regulation. "On the one hand, we're trying to protect people investing in crypto, but on the other hand, we're doing things that may undermine protections in our traditional securities markets," said witness Timothy Massad, a former CFTC chairman who now focuses on digital assets at Harvard University's Kennedy School of Government. "We must not screw up existing securities regulations or standards," Himes said, asking why the bill's special securities-regulation exemptions for certain investment contracts for digital commodities need to exist, arguing that the legislation's exemptions might be abused by sophisticated securities lawyers. But committee Chairman French Hill argued this bill is "more robust" on consumer and market protections than the predecessor legislation in the last session, which drew yes votes from 71 Democrats in the House. While the House may be able to more easily advance controversial legislation, the Senate generally requires wide bipartisan support to clear its particular hurdles. So, Democrats there must be on board before the market structure bill can become law. Next week, the Clarity Act may get a markup in Hill's committee — a formal session in which legislation is debated and amended before potentially being advanced to the overall House. The financial services panel's ranking Democrat, Representative Maxine Waters, said on Wednesday that this next stage could come on June 10.
Yahoo
7 days ago
- Business
- Yahoo
Dems Say They're Blocked From Info on Verge of Crypto Market Structure Bill Hearings
On the eve of a U.S. House of Representatives hearing to scrutinize a bill to establish rules for the crypto markets, Democrats said they've been stymied from seeking technical information about its effects from the U.S. Securities and Exchange Commission, according to staffers. Regulatory agencies such as the SEC routinely give technical analysis to lawmakers, answering questions about the potential effects of legislative efforts such as the Digital Asset Market Clarity Act that would establish regulatory guardrails for digital assets. Democratic staff on the House Financial Services Committee submitted questions to the SEC about the bill and in a briefing were denied basic answers that were previously given to Republicans, according to the Democratic aides who asked not to be named. The agency also didn't offer its subject-matter experts for the discussion, they said. On Tuesday, the panel's ranking Democrat, Representative Maxine Waters of California, prepared a letter to SEC Chairman Paul Atkins to demand "comprehensive technical and impact analysis" of the crypto market structure bill. She included several pages of questions in a draft reviewed by CoinDesk, contending that "fulsome answers to the questions raised above are necessary for the American people, through their representatives in Congress, to determine whether this legislative proposal addresses the unique risks related to crypto, and would foster the needed environment for responsible innovation to take root." The SEC "provides technical assistance to any Member of Congress who seeks it, including on these crypto-related bills," a spokesperson told CoinDesk when asked about the complaints. One of the staffers said that the SEC Crypto Task Force's Landon Zinda, who moved to the agency from crypto advocacy group Coin Center in February, was meant to brief them but was unable to answer basic questions. The House committee is set to hold the Clarity Act hearing on Wednesday after having recently introduced the long-negotiated legislation, a successor of the last sessions' Financial Innovation and Technology for the 21st Century Act (FIT21). The House Agriculture Committee, which also has jurisdiction over the regulation of digital assets, is running its own hearing at the same time. This bill represents the central policy goal of the crypto industry, which contends that it needs clear U.S. regulations to encourage investors who've waited on the sidelines and to keep crypto innovators from moving overseas. The Democratic staffers say that members have concerns about the traditional securities firms finding loopholes in this major legislation that will allow them to skirt existing securities regulations. But congressional Democrats haven't acted as a block when it comes to this and a related stablecoin bill also making its way through the legislative process. While some leaders, including Waters, have opposed advancing crypto legislation, other Democrats have joined with Republicans to move bills forward in both the House and Senate. Updates with a response from the SEC and further information from sources.
Axios
29-05-2025
- Business
- Axios
House introduces new effort to regulate cryptocurrency
Key members of House leadership, as well as three Democrats, introduced new legislation Thursday to clarify the lanes of responsibility for regulatory oversight of digital assets. Why it matters: While the cryptocurrency business is often described as a Wild West, longtime practitioners argue that the only reason they haven't been following rules is because the U.S. hasn't written rules for them to follow. " This bill is a bold step to ensuring that the next iteration of the internet is developed by Americans and driven by our values," House Majority Whip Tom Emmer (R.-Minn.), one of the co-sponsors at introduction, said in a statement. The Digital Asset Market Clarity Act, a so-called market structure bill, provides for clear delineation of responsibility between the CFTC and the SEC, according to a one-pager from the bill's authors. Digital asset issuers can register to use tokens to raise money for new ventures under SEC supervision. Trading venues for most secondary sales of digital assets would be supervised by the CFTC. Overall, the bill provides an extension of the disclosure-based regime that has been used for other markets, but directs agencies to update it with regard to this new category of asset. Zoom in: The legislation specifically requires dealers and brokers to segregate customer funds from their own and disclose conflicts of interest. Issues such as those were at the heart of what unwound the bankrupt exchange FTX in 2022. Between the lines: Section 203 of the draft legislation effectively codifies the decision in the SEC vs. Ripple case, where the court ruled that transactions on a secondary market were not necessarily securities, even if the initial sale was. What they're saying: " These bipartisan co-sponsors have been some of the fiercest crypto leaders in Congress, and their bill takes an important step towards establishing a common-sense regulatory framework for digital assets in the U.S.," Meghan Pennington, a spokesperson for the industry group Stand with Crypto, said in a statement. "We urge congressional leaders to prioritize swift action on this legislation to solidify America's global leadership in the blockchain economy." Flashback: In the last Congress, the House sent a version of this legislation to the Senate, but the higher chamber never picked it up.
