US lawmaker proposes safe harbor for digital tokens in new bill
North Carolina House Representative Patrick McHenry has proposed a invoice that could amend one of the legal guidelines governing america Securities and Exchange Commission (SEC) to offer a secure harbor for positive token initiatives.
In a draft of the “Clarity for Digital Tokens Act of 2021,” furnished via way of means of the House Committee on Financial Services, McHenry cautioned amending the Securities Act of 1933 to set up a secure harbor for token improvement groups. He proposed letting initiatives provide tokens with out registering for up to a few years, at some point of which period groups might take delivery of the possibility to create a totally decentralized community.
McHenry’s invoice reputedly builds on an initiative from SEC commissioner Hester Peirce, who has referred to as for the introduction of a secure harbor for initiatives that increase price range to construct decentralized networks after first floating the idea in 2019. Peirce’s suggestion likewise indicates granting community builders a three-yr grace length to construct a decentralized community with out threats of felony movement from the SEC.
“If adopted, the proposed secure harbor might be the maximum groundbreaking improvement for the U.S. cryptocurrency marketplace to date,” Peirce stated in February 2020. “By setting improvement first and giving initiatives runway to construct strong networks, the proposed secure harbor places an essential stake withinside the floor in the direction of helping American get right of entry to and attractiveness of virtual asset markets.”
The suggestion comes the equal day SEC chair Gary Gensler spoke to the committee concerning oversight of the authorities agency. McHenry stated Gensler had made “regarding and contradictory” statements on crypto belongings regarding the SEC’s enforcement movements and regulatory purview.
“We want to nurture innovation and era on this country, now no longer ship it overseas,” stated McHenry. “This invoice […] allows convey felony actuality to virtual asset initiatives that we badly want regulatory readability to launch.”
Kristin Smith, govt director of the Blockchain Association, recounseled McHenry’s efforts to create a secure harbor, emphasizing the collaboration among innovators and regulators. The Chamber of Digital Commerce, a crypto advocacy institution withinside the United States, stated the invoice “has the capability to offer a far wanted clean direction ahead for the ones developing new improvements and answers leveraging virtual tokens.”
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McHenry — recognized via way of means of many in Congress as “Mr. Fintech” — has placed forth numerous portions of pro-crypto legislation, together with suggesting that the Commodity Futures Trading Commission and SEC “set up a joint operating institution on virtual belongings” to cope with regulatory readability withinside the crypto space. He has additionally advised his fellow lawmakers that tries to forestall Bitcoin (BTC) had been futile because the cryptocurrency become an “unstoppable force.”