Members of the US House of Representatives Financial Services Committee met to discuss clarity on the digital asset ecosystem, with some members citing recent legal action by the US Securities and Exchange Commission (SEC) against crypto firms.
During a committee hearing on June 13, ranking member Maxine Waters said that Democrats are taking a “serious and thoughtful look” at Republicans' proposed framework for digital asset regulation. Committee Chairman Patrick McHenry said he expects bipartisan input on the draft bill and a price increase after Congress recessions in July. Waters suggested that without extensive analysis and cooperation between the two parties, digital asset legislation could open the door to potential fraud and misuse of client funds. The California representative cited the collapse of FTX, cri minal charges against former FTX CEO Sam Bankman-Fried, and recent SEC actions against Binance and Coinbase.m particularly concerned that the Republican bill would allow crypto companies currently being sued for violating our securities laws to continue doing business through provisional registration,” Waters said. “This bill appears to halt any enforcement action by the SEC against cryptocurrency companies, even if they are fraudulent. This temporary registration could give bad actors a 'jail-free' card to continue harming consumers and investments By."
The draft bill, introduced on June 2, would prohibit the SEC from refusing to register digital asset trading platforms as regulated alternative trading systems and would allow such companies to offer “stablecoins for digital goods and payments.” It will also restructure the roles of the Securities and Exchange Commission and the Commodity Futures Trading Commission in regulating digital assets in the United States. “When it comes to FTX and when it comes to breaches or alleged breaches involving Binance and Coinbase, the American public is the one carrying the baggage,” Prometheum founder and co-CEO Aaron Kaplan said at the hearing. “The best The way forward is very clear and logical, which is to apply the federal securities laws [through the SEC].”
Other lawmakers reacted differently to the SEC's seemingly enforceable approach. On June 12, Rep. Warren Davidson of Ohio -- also a Republican on the House Financial Services Committee -- proposed legislation to fire SEC Chairman Gary Gensler that would also restructure the committ ee's powers. The legality of the proposed move is unclear. In the SEC lawsuit, Binance.US opposed the committee's efforts to freeze its funds. At the time of publication, a federal judge in Washington, DC, was considering competing motions from the SEC, Binance and Binance.US over how to dispose of assets and other pending legal proceedings.
