‘Rules of the Road’ Must be Created for the Digital Asset Industry

Sean Patrick Maloney (D-NY), chair of the U.S. House of Representatives Agriculture Committee’s Subcommittee on Commodities Trading, Energy, and Credit, held a hearing last week on the future of digital asset regulation to create a “road for the digital asset industry.” Maloney said, “It’s as important as ever that Congress provides direction for establishing rules of the road to ensure U.S. retail investors in digital assets have information and protections,”

This is also the view expressed by the congressional witnesses who were present. Jonathan Levin of Chainalysis told the subcommittee that “transparency from blockchain enhances the ability of policymakers to detect, disrupt and ultimately deter illicit activity and abuse in digital currency markets” and called for legislation to clarify the division of responsibilities between regulators such as the CFTC and the SEC. Over the past month, the focus of bipartisan political activity has been digital asset regulation.

The House Agriculture Committee, which oversees the Commodity Futures Trading Commission (CFTC), will see a boost in its oversight in a sweeping digital asset bill introduced earlier in June. The Responsible Financial Innovation Act aims to increase flexibility, innovation, transparency, and consumer protection for digital assets.

Maloney mentioned the proposed changes in his opening remarks on Thursday, June 23rd. Bipartisan hearings have identified some of the challenges to expected reforms like the Responsible Financial Innovation Act, while uncertainty remains about how the CFTC and SEC will divide labor. What remains, however, is a strong bipartisan commitment to the overarching goal of strengthening U.S. digital asset regulation — and lawmakers are simply figuring out the best way to do it.