U.S. industry watchdogs oppose draft bill on crypto market structure

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An alliance of industry watchdogs based in the United States has united to express their opposition to the proposed draft bill on the crypto market structure by the United States House Financial Services Committee.

In a detailed correspondence addressed to the U.S. House Committee on Financial Services, groups including Americans for Financial Reform and the Center for Responsible Lending claimed that stakeholders in the crypto industry had actively lobbied in support of the Committee’s draft proposal, known as the ‘Digital Asset Market Structure Discussion Draft’ bill. The watchdogs asserted that the crypto industry failed to demonstrate any practical use cases beyond speculative investment.

The letter accused the crypto market of seeking favorable legislation under the guise of crypto innovation:

“Of particular concern is the proposed bill’s provision that would alter the SEC’s evaluation of regulatory rulemaking in all securities markets, compelling the agency to assess new rules based on the criterion of ‘innovation.'”

The intention behind the comprehensive digital asset bill was to establish a regulatory framework in the United States, encompassing well-defined rules and guidelines for the crypto industry. Earlier, Cointelegraph reported that the committee Chair, Patrick McHenry planned to hold a committee vote in July 2023. The focal point of the draft bill revolves around the involvement of the U.S. Securities and Exchange Commission (SEC) in overseeing the regulatory framework.

Screenshot of the Crypto Markets Bill opposition sign-on letter. Source: Our Financial Security

In June 2023, the SEC launched individual legal actions against two prominent crypto exchanges, Coinbase and Binance, both known for their substantial trading volumes. Surprisingly, traders swiftly assimilated this news, resulting in minimal impact on the price of Bitcoin.

Related: What to expect from the first Coinbase-SEC hearing

In opposition to widespread demand, the watchdogs asserted that Congress should actually back the ongoing enforcement actions of the SEC as a means to “safeguard consumers.” Conversely, various jurisdictions in Europe and Asia are actively striving to accommodate crypto businesses relocating away from the United States.

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?