5 New Cryptocurrency Laws
Central governments are taking serious notice of cryptocurrencies. Around the world, governments are legislating cryptocurrency regulations. In the U.S. alone, 80 different bills have been introduced into Congress in 2022 alone to cryptocurrencies and digital assets. Here are seven new cryptocurrency laws in the U.S. that have passed or are being debated.
1. Digital Asset Market Structure and Investor Protection Act
HR4741 grants the Securities and Exchange Commission the authority to oversee digital asset securities. Further, it regulates digital assets which entitle the holder with equity or debt interest, rights of payment, voting rights in corporate scenarios (such as DAOs) and liquidation rights.
It grants the Commodities Futures Trading Commission authority over creation of cryptocurrencies. It will ensure that cryptocurrencies are programmed to operate in accordance with “rules that govern the creation, supply, ownership, use and transfer of the asset”.
It goes on to define digital assets, digital securities and stablecoins as “not U.S. legal tender”.
2. Consumer Safety Technology Act
HB3723 requires the Consumer Product Safety Commission to relay with stakeholders about cryptocurrency-related hardware products during early stage processes to:
Track trends of injuries involving assets
Monitor sales of recalled products
Identify sales of products that do not meet importation standards
Identify product hazards
3. Countering America’s Adversaries Through Sanctions Act
HR3364 established intergovernmental agencies to analyze “emerging illicit finance threats”. Since 2014, terrorist groups such as the Islamic state, Al Qaeda and Hezbollah have slowly adopted the use of cryptocurrency to finance their activities.
Scrutiny of cryptocurrencies being used to finance terrorism will be another measure the government will take against cyber crime.
4. Accountability for Cryptocurrency in El Salvador Act (ACES)
HB7391 will put together an exploratory group to research and assess the outcomes of El Salvador’s adoption of Bitcoin as a sovereign legal tender (albeit alongside the U.S. dollar).
Federal departments and agencies, headed by the Secretary of State, will submit its findings to Congress.
The reports will assess El Salvador’s regulatory framework, its ability to secure cyber risks, impacts on individuals and businesses using Bitcoin, and the flow of remittances from the U.S. to El Salvador. The effects of Bitcoin use among the unbanked population will also be examined.
5. Central Bank Digital Currency Study Act of 2021
HR2211 directs the Board of Governors of the Federal Reserve System to “conduct a study on central bank digital currencies (CBDC) and for other purposes.”
Congress wants the board to “conduct research on, design, and develop a CBDC that takes into account its impact on consumers, businesses, the United States financial system, and the United States economy”.
As the IMF Managing Director, Kristalina Georgieva, has stated, “careful design and policy considerations will underpin trust in CBDCs. But let us not forget that trust must be anchored in credible central banks with a history of delivering on their mandates.”
CBDCs bear a particular irony by centralizing something that is inherently decentralized. The very reason so many people are turning away from fiat currencies to cryptocurrencies is precisely because they do not trust governments’ central banks.
Cryptocurrency outlook
Precedents will of course be set for cryptocurrency regulations as the laws take effect. Many in the web3 community see these regulations as flying the face of decentralization, the hallmark of cryptocurrency. They have called for “privacy by design” rather than by law.
No matter what cryptocurrency regulations do or don’t get passed, one thing is for certain: that each person must take responsibility for their privacy, security, and business decisions.
What do you think about these new laws? Join the discussion on our Discord and Reddit.
