Senate Democrats unveil digital asset oversight framework
Twelve Senate Democrats released a policy framework that would give the Commodity Futures Trading Commission (CFTC) authority over spot trading of digital assets that are not securities. The proposal also calls for clearer Securities and Exchange Commission (SEC) guidance and stronger anti-money laundering requirements.
The initiative group included Ruben Gallego, Kirsten Gillibrand, Cory Booker, Raphael Warnock, and others. The plan describes specific points aimed at closing gaps in digital asset regulation and integrating trading platforms and existing token issuers into the current financial system.
Democrats want to give the CFTC power to register market participants, enforcement tools, and the right to create "core principles" standards for digital asset platforms. The draft includes consumer protection rules, requirements for platforms to disclose information, and a clear listing procedure.
Another section focuses on evaluating assets as securities. The senators want to force regulators, specifically the SEC, to release special guidance on applying old securities law to modern assets. The document also requires disclosure of all information when insiders have it but retail investors do not.
The GENIUS Act prohibition on interest or yield payments by stablecoin issuers remains in place, while all trading platforms must register with the Financial Crimes Enforcement Network (FinCEN) as financial institutions, implement Bank Secrecy Act (BSA) and anti-money laundering programs, and comply with sanctions even when registered abroad.
Democrats included a separate provision that would ban elected officials and their family members from issuing, supporting, or profiting from digital assets while in office. The proposal also requires disclosure of existing digital asset holdings and paid activities involving asset issuers and promoters.
The initiative emerged during ongoing congressional negotiations on digital regulation. The House of Representatives passed the bipartisan Digital Asset Market Clarity Act in July. While Senate Republicans have their own bill, they need support from at least seven Democrats for passage.
Another section focuses on evaluating assets as securities. The senators want to force regulators, specifically the SEC, to release special guidance on applying old securities law to modern assets. The document also requires disclosure of all information when insiders have it but retail investors do not.
The GENIUS Act prohibition on interest or yield payments by stablecoin issuers remains in place, while all trading platforms must register with the Financial Crimes Enforcement Network (FinCEN) as financial institutions, implement Bank Secrecy Act (BSA) and anti-money laundering programs, and comply with sanctions even when registered abroad.
Democrats included a separate provision that would ban elected officials and their family members from issuing, supporting, or profiting from digital assets while in office. The proposal also requires disclosure of existing digital asset holdings and paid activities involving asset issuers and promoters.
The initiative emerged during ongoing congressional negotiations on digital regulation. The House of Representatives passed the bipartisan Digital Asset Market Clarity Act in July. While Senate Republicans have their own bill, they need support from at least seven Democrats for passage.
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