Title: Digital Commodity Exchange Act of 2020: US Lawmakers Propose Single National Crypto Framework – Bitcoin News
Headings: Digital Commodity Exchange Act of 2020: US Lawmakers Propose Single National Crypto Framework
Digital Commodity Exchange Act of 2020: US Lawmakers Propose Single National Crypto Framework
Digital Commodity Exchange Act of 2020
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Content: Under the proposal, a registered Digital Commodity Exchange (DCE) would be subject to CFTC oversight and regulations, including the “monitoring of trading activity, prohibition of abusive trading practices, minimum capital requirements, public reporting of trading information, conflicts of interest, governance standards, cybersecurity, and more. Exchanges would also be subject to limitations on which digital commodities they would be permitted to offer for trading.” Conaway added that “Digital commodity trading platforms are currently required to comply with a complicated labyrinth of 53 state and territory regulatory frameworks, hindering the ability for newcomers to enter the market.” “Registration with the CFTC would preempt the existing state-based money transmitter licensing regime trading venues are currently subjected to,” the summary continues, adding that the current system is “not fit-for-purpose when applied to a spot trading market.” In addition, the document states that “The current regime is cumbersome, requiring separate licensing in each individual state of operation, and insufficient, failing to provide oversight of the trading and market activities that occur on the platform,” emphasizing: The registration regime is voluntary, but with strong incentives for properly placed trading venues to seek registration. Trading venues would be able to opt into the CFTC Digital Commodity Exchange regime or remain regulated under individual state money transmitter licenses. Furthermore, a registered DCE would be required to hold customers’ cryptocurrencies in a Qualified Digital Commodity Custodian that is regulated by a state, federal, or international banking regulator. The regulator must impose at least the minimum standards set by the CFTC for the entity to be “qualified.” The full Digital Commodity Exchange Act of 2020 bill can be found here.