Tag: digital assets

state of stablecoins

It’s starting to become clear that the front lines of the stablecoin legislation battle in House Financial Services (HFS) is being fought in the state of New York.

That’s no surprise given Ranking Member Maxine Water’s (D, CA) position (and the White House’s position) on the Federal agencies having the last word on stablecoin registrations. The robust state stablecoin regime currently available through the New York Department of Financial Services (NYDFS) and led by Superintendent Adrienne Harris says a state framework can work – potentially without the Federal “last word.”

Remember that awkward moment in April when Superintendent Harris told Ranking Member Waters about New York’s stablecoin framework at an HFS stablecoin hearing to Waters’ surprise?

Rep. Ritchie Torres (D, NY) and Rep. Gregory Meeks (D, NY) votes in support of the stablecoin bill coming out of the HFS Committee markup last week reinforce the bipartisan interest in preserving state’s rights when it comes to stablecoins.

Punchbowl News’ Brendan Pedersen reported yesterday on NYDFS’s involvement in the stablecoin bill and speaks to Rep. Torres, who said, “New York members, such as myself, take our guidance from Adrienne. If she were dissatisfied with the state option in the bill, then I would have trouble supporting it.”

And then there’s the separate intrastate battle which NYDFS and Superintendent Harris are waging with New York State Attorney General Letitia James.  There was a lof of fanfare when James issued her own legislation (CRPTO) to address the crypto industry – seemingly circumventing NYDFS and Harris. But, with expectations of a June ratification of sorts in New York State’s assembly having quietly fallen by the wayside, nothing has come of James’ legislation thus far. Continue reading “New York State Inserts Itself In Stablecoin Bill Debate; IRS Issues Guidance On Staking Rewards”

Senate AML-KYC

Senator Elizabeth Warren (D, MA) announced the re-introduction of the bipartisan “[S.2669] Digital Asset Money Laundering Act” in the Senate late last week and added two, powerful new co-sponsors and a well-known industry trade group for lenders called the Bank Policy Institute. The bill looks to tighten rules around Anti-Money-Laundering (AML) and Know Your Customer (KYC) requirements.

In addition to Senator Roger Marshall (R, KS) who co-sponsored the bill in the last Congress, Senators Joe Manchin (D, WV) and Lindsey Graham (R, SC) have come aboard. Manchin says in the release, “Our bipartisan legislation would curtail these security risks and require cryptocurrency platforms to abide by the same anti-money-laundering rules that banks have to follow.”

The press release also notes that the recent NDAA amendment co-sponsored by Sens. Kirsten Gillibrand (D, NY), Cynthia Lummis (R, WY), Warren and Marshall overlaps with the re-introduced bill. How the two play out in the coming weeks may be driven on the final version of the NDAA as the Senate and House negotiate.

See the press release. And, download the one-pager and the bill.

The bill has been referred to the Senate Banking Committee.

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Warren and Graham have separately formed a partnership with a bill called, “Digital Consumer Protection Commission Act” targeting “big tech.” Continue reading “Money Laundering Act Adds Senators Graham, Manchin; Apple And The Blockchain”

Markups – today and tomorrow

Between the House Financial Services (HFS) Committee and the House Agriculture Committee, there are now three (3) markups scheduled which include digital assets legislation crafted by the committees – one markup is today, two are tomorrow.

Markup #1 – Today’s HFS markup led by Chair Patrick McHenry (R, NC) entails six (6) bills including the digital asset market structure bill known as “H.R. 4763 – Financial Innovation and Technology for the 21st Century Act.”

• • Today’s HFS landing page with the bills and live stream are here. Starts at 10 a.m. ET.
  • Among the other bills to watch today is a bipartisan effort introduced by Majority Whip Rep. Tom Emmer’s (R, MN) “H.R.1747 – Blockchain Regulatory Certainty Act” co-sponsored by Rep. Darren Soto (D, FL).

Markup #2 – Tomorrow’s  HFS markup entails seven (7) bills including the stablecoin bill known as “H.R. 4766 – Clarity for Payment Stablecoins Act of 2023.”

• • Tomorrow’s HFS landing page with the bills and live stream are here. Starts at 9 a.m. ET.

Markup #3 – Also tomorrow, the House Agriculture Committee led by Chair Glenn “GT” Thompson (R, PA) will convene their own markup of “H.R. 4763 – Financial Innovation and Technology for the 21st Century Act.”

• • Tomorrow’s House Ag landing page with the bill and live stream are here. Starts at 10 a.m. ET.

Continue reading “Historic Digital Assets Markup Hearings Begin Today”

market structure markup

The House Agriculture Committee confirmed late yesterday that this week’s House Ag markup led by Chair Glenn “GT” Thompson (R, PA) for the digital assets market structure bill – a.k.a. H.R. 4763, “The Financial Innovation and Technology for the 21st Century Act” – is scheduled for Thursday at 10 a.m.

See the hearing’s landing page. Live stream will be here, too.

This is the day after Chair Patrick McHenry (R, NC) will lead House Financial Services Committee and its markup hearing on the market structure bill as well as six others.

With Majority leader Rep. Tom Emmer (R, MN) joining the bill, the hope is that a House vote will be possible in the September-October time frame.

AML-KYC clouds

Even with first-ever, digital assets legislation reaching the markup stage in the House Financial Services and Agriculture Committtees, there are plenty of clouds gathering for crypto in Congress observes Politico’s Eleanor Mueller.

She sees the recent Lummis-Gillibrand and Warren-Marshall partnership over a National Defense Authorization Act (NDAA) amendment as a sign of wider misgivings in Congress – the Senate, in particular – that center around enforcement of anti-money laundering (AML) and know-your customer (KYC) requirements for crypto. The new CANSEE legislation supported by a bipartisan group of Senators including its lead sponsor, Sen. Jack Reed (D, RI), strikes similar AML/KYC “notes.” Continue reading “House Agriculture Schedules Thursday Markup; AML, KYC Meet Crypto Concerns In DC”

HFS markup details released

Late Friday, the House Financial Services (HFS) Committee led by Chair Patrick McHenry (R, NC) issued a press release announcing its markup of seven different bills which will commence this Wednesday, July 26 at 10 a.m. at 10:00 a.m. at the Rayburn House Office Building.

See the hearing page. And, view the Memorandum (PDF).

The seven are (links go to Congress.gov):

1. 1. H.R. 4763, the Financial Innovation and Technology for the 21st Century Act (Thompson/Hill/Johnson)
   2. H.R. 4766, the Clarity for Payment Stablecoins Act of 2023 (McHenry)
   3. H.R. 1747, the Blockchain Regulatory Certainty Act (Emmer)
   4. H.R. 3244, the Stop Fentanyl Money Laundering Act of 2023 (Luetkemeyer)
   5. H.R. 4768, the No Russian Agriculture Act (Waters)
   6. H.R. 4765, the Exposing China’s Support for the Taliban Act (Lynch)
   7. H.R. 2969, the Financial Technology Protection Act of 2023 (Nunn)

Notable among them is the very latest version of the stablecoin bill: H.R. 4766, “The Clarity for Payment Stablecoins Act of 2023”. See the text (PDF).

From the Memorandum on the stablecoin bill: “H.R. 4766 provides a clear regulatory framework for the issuance of payment stablecoins that are
designed to be used as a means of payment. The framework mitigates potential risks posed by payment stablecoins, while at the same time fostering innovation by establishing a tailored approach for new entrants into the marketplace.” Continue reading “Crucial Hearing For Digital Assets And Congress This Wednesday”

new bill for digital assets

In a tantalizing tweet for the crypto throngs at 3:16 pm. ET on Twitter yesterday, the Republican House Agriculture Committee account said, “👀Some big #crypto news coming soon…”

[drum roll, please]

About an hour later, House Agriculture Chair GT Thompson (R, PA) delivered the news that the new market structure bill for digital assets – which include some changes from the discussion draft according to sources – has a new name, “H.R. 4763, the Financial Innovation and Technology for the 21st Century Act.” Sources also confirm it will be heading to a markup next week.

From the release: “Today, Glenn “GT” Thompson (R, PA), Chairman of the House Committee on Agriculture, and French Hill (R, AR), Chairman of the Subcommittee on Digital Assets, Financial Technology and Inclusion, and Dusty Johnson (R, SD), Chairman of the Subcommittee on Commodity Markets, Digital Assets, and Rural Development, introduced H.R. 4763, the Financial Innovation and Technology for the 21st Century Act. Additional cosponsors include Reps. Tom Emmer (R, MN) and Warren Davidson (R, OH).”

Chair Thompson is quoted in the release: “Today’s introduction of the Financial Innovation and Technology for the 21st Century Act marks a significant milestone in the House Committees on Agriculture and Financial Services efforts to establish a much-needed regulatory framework that protects consumers and investors and fosters American leadership in the digital asset space.” Read more. Continue reading “Financial Innovation and Technology for the 21st Century Act Introduced; FedNow Goes Live”

new DeFi bill

A new bipartisan bill introduced on Tuesday is focused on decentralized finance (DeFi) and its combination with Anti-Money-Laundering (AML) and Know Your Customer (KYC) requirements – and concerns. There is nothing related to innovation in this bill.

Called the “Crypto-Asset National Security Enhancement Act of 2023” and introduced by Senate Banking Sen. Jack Reed (D, RI) with Senators Mark Warner (D, VA), Mike Rounds (R, SD) and Mitt Romney (R, UT) as co-sponsors.

The bill is known as “S.2355” on Congress.gov or “A bill to clarify the applicability of sanctions and antimoney laundering compliance obligations to United States persons in the decentralized finance technology sector and virtual currency kiosk operators, and for other purposes.” Visit Congress.gov.

CoinDesk reports that the bill places “requirements on ‘anyone who “controls” a DeFi protocol or makes available an application to use the protocol,’ likely a reference to groups who build user-friendly frontends for protocols’ otherwise cumbersome smart contracts, as Uniswap Labs does for Ethereum’s top decentralized exchange.”

Read all about it.

new DeFi bill – ‘purport’

According to the Congressional Record, Sen. Reed said in introducing the bill, “Decentralized finance or ‘DeFi’ refers to cryptocurrency protocols and applications that purport to allow automated peer-to-peer transactions using blockchain technology. DeFi enables users to transact and trade cryptocurrency without requiring a traditional financial institution to broker trades, clear and settle transactions, or custody assets.”

Reed added, “Criminal syndicates, fraudsters, ransomware hackers, and rogue states have been quick to recognize how DeFi can be exploited to advance their nefarious activities. By design, DeFi provides anonymity allowing malicious and criminal actors to evade traditional tools that the government uses to enforce the AML and sanctions laws.” Read more.

The industry association, DeFi Education Fund, didn’t hesitate in offering its ‘take’ on the new bill. From its Twitter account, the Fund said in a thread, “While we are supportive of effective measures to combat the illicit use of DeFi, the bill introduced today essentially says ‘centralize, shut down, or get out of the United States.’ There are far better options that can not only help combat the illicit abuse of DeFi but also do so at a much lower cost to crypto users’ rights and to technological innovation in the United States.”

Digital Chamber of Commerce commented on the bill in a blog post. The industry organization is not impressed: “The Chamber views it as an excessive and misguided approach to addressing security issues related to decentralized finance (DeFi) and Crypto Kiosks.” Read more – including Digital Chamber policy executive Cody Carbone explaining why its a “bad bill.”

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Regarding “crypto-asset,” do we really need the hyphen?
Continue reading “Bipartisan DeFi Bill Introduced By Senator Reed; Crypto Amendment Bill Update”