Cryptos are independent, untraceable currencies. That is one of their main attractions. However, ever since their introduction, the authorities have been speaking about restrictions and regulations to control them. It seems they may get what they sought, at least in the U.S., if the new bill gets Congress’ approval.
United States Representative Paul Gosar has introduced the “Cryptocurrency Act of 2020” to Congress recently. The bill seeks to set clearer regulations on cryptos. According to Gosar, it would make it easier for businesses, as well as citizens, to take part in the growing industry.
What is the new bill about?
“Cryptocurrency Act of 2020” mostly refers to crypto regulations. According to the bill, specific federal agencies will participate in the regulation of digital assets. Entities creating or trading digital assets would have to seek government approval first. And afterwards, the agencies would inform the public of its grant of federal licenses, registrations, and certificates.
Paul Gosar divided crypto assets into three parts: “crypto-currency,” “crypto-commodity,” and “crypto-security.” The primary regulators for crypto-currencies will be the Comptroller of the Currency and the Financial Crimes Enforcement Network.
On the other hand, the Commodity Futures Trading Commission will regulate crypto-commodities. And the Securities and Exchange Commission will be the regulator for crypto-securities and “synthetic” stablecoins.
However, that’s not all. The crypto owners must allow FinCEN to trace crypto transactions, as well as the individuals involved in the corresponding transactions. It means that cryptos will get the same regulatory treatment as traditional financial institutions.
FinCEN will also conduct audits for each reserve-backed stablecoin to make sure that each of them is fully backed by currencies issued by the local or foreign authorities they represent.
According to Goldey, he chose to gather stakeholder support and worked with them, as well as outside experts to decide what to improve. Some cryptocurrency owners also support the bill. Bitcoin millionaire Erik Finman even participated in its drafting.