US to Form ‘Digital Asset Working Group’ to Clarify Crypto Regulations

The U.S financial regulators are to work collectively to develop modalities for explicit crypto regulations in the country. 

The House of Representatives of the United States passed H.R. 1602 or ‘the Eliminate Barriers to Innovation Act’ proposed by Republican Congressman Patrick McHenry. 

This act was among the six other acts related to financial services that were passed by the House of Representatives on Tuesday. McHenry’s proposed legislation focused on the need for regulatory clarity regarding cryptocurrency.

This bill was proposed back in March and it is looking for clarity regarding the authorities like the Securities and Exchange Commission and the Commodity Futures Trading Commission and what part do they play in cryptocurrency policing in the United States. 

Addressing the floor of the House during the passage of the bill, McHenry remarked: “This bill] requires the Securities and Exchange Commission and the Commodity Futures Trading Commission to establish a working group focused on digital assets. This is the first step in opening up the dialogue between our regulators and market participants and move to needed clarity.”

The terms of the bill provide the period of 90 days to Congress to create a working group between the participants of SEC, CFTC, and the private sector.

The participants for private-sector would be taken from fintech and financial service companies along with small to medium size entities and academia. 

#BREAKING: The House just passed 6 bipartisan Financial Services bills, including Ranking Member @PatrickMcHenry’s Eliminate Barriers to Innovation Act.

Learn more: https://t.co/jYrqQbSxXf

Watch the Ranking Member’s remarks 📺👇 pic.twitter.com/BAAyEf91qy

— Financial Services GOP (@FinancialCmte) April 20, 2021

After the working group has been constituted, it would have a year to authorise a report that will completely analyse the current crypto regulatory measures. The working group will also be required to focus on the issues like crypto custody, private key management, cybersecurity, and concerns for investor protection. 

The industry stakeholders in the USA are somewhat frustrated due to the patchwork nature of crypto regulation in the country. Some industry experts have highlighted that the USA is at risk of losing its competitive edge in the rising digital economy due to the ambiguous regulatory measures for digital assets.