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Bill that regulates cryptocurrencies in the US leaks

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A document that allegedly forms part of the regulation of cryptocurrencies in the United States was leaked. Several profiles on Twitter had access to the bill which has 600 pages, and publicized it throughout the social network.

According to information, the alleged law establishes protection for market investors, but also increases the operational demands that exchanges will have to bear. The law also mentions decentralized finance (DeFi) and decentralized autonomous organizations (DAO).

On the other hand, Senators Kirsten Gillibrand and Cynthia Lummis – the latter, a well-known supporter of cryptocurrencies – also introduced a bill. In this sense, the senators advocate tax exemption for cryptocurrency transactions up to $200.

The content of the new bill

Firstly, the bill establishes the protection of cryptocurrency users against scams, hacker attacks and bank runs. The measures place special emphasis on DeFi, stablecoins, DAOs and cryptocurrency exchanges.

Then the main point concerns the classification of cryptocurrency projects. The law will classify many cryptocurrency projects as commodities, not digital assets.

In this sense, the law will encompass any project dealing with debt, equity, profit or dividend income of any variety.

That is, the law will fit many projects created via ICO since 2017 in this classification. In this sense, the project follows the same line as the Futures and Commodities Trading Commission (CFTC), for whom cryptocurrencies are treated as commodities.

According to the leaked documents, DAOs, exchanges and stablecoin providers will need to become registered entities to operate in the US. With that, they are supposed to pay taxes and be subject to American laws.

The proposal also gives depository institutions such as banks the right to issue stablecoins. This extends a 2020 authorization through which banks were allowed to store stablecoin backing.

More demands for exchanges

At the same time, the law will also affect operating demands for cryptocurrency exchanges. This is because, according to the project, these platforms must adopt compliance policies to serve US customers.

In other words, the infamous KYC will be imposed on all exchanges. To top it off, companies will have to pay the government a portion of the fees charged to customers.

The law also addresses the controversial exchange failure case. In this case, if an exchange fails, the deposited assets remain in the possession of customers. Therefore, the company will have to return them and will not be able to take possession of the cryptocurrencies.

The topic gained strength because of a statement made by Coinbase that implied that, in the event of bankruptcy, the exchange could appropriate cryptocurrencies from customers. The proposed law establishes that this should not occur in the case of exchanges.

While the proposed bill appears to increase operating costs, part of the cryptocurrency community has welcomed the idea as it brings regulatory clarity to the industry.

Senators want exemption from small amounts

While someone released a bill without permission, Senators Cynthia Lummis and Kirsten Gillibrand released their bill. The law was the result of a bipartisan effort, as Lummis is a Republican and Gillibrand is a Democrat.

The law has as its main topic the exemption of small cryptocurrency transactions. In this regard, the bill exempts transactions equivalent to up to $200 from taxes. The bill also classifies cryptocurrencies as commodities and places their regulation in the hands of the CFTC.

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All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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