The US President Donald Trump’s Working Group on Digital Belongings launched its long-promised crypto report outlining coverage suggestions for regulating crypto in the US, together with crypto market construction, jurisdictional oversight, banking rules, selling US greenback hegemony via stablecoins and taxation of cryptocurrencies.
Establishing a “taxonomy” of digital assets by clearly defining which cryptocurrencies are securities and that are commodities was the primary challenge outlined within the report, launched on Wednesday.
In accordance with suggestions within the doc, jurisdictional oversight over digital belongings must be shared between the Commodity Futures Buying and selling Fee (CFTC) and the Securities and Trade Fee (SEC), with the CFTC having oversight over spot crypto markets.
The working group beneficial that the SEC and CFTC collaborate on crypto oversight. Commodity tokens must be ruled by the CFTC, whereas different tokens deemed to be securities will likely be topic to SEC oversight. The authors of the report stated a clearly outlined crypto market construction would make the US a worldwide chief in digital belongings.
“A rational regulatory framework for digital belongings is one of the best ways to catalyze American innovation, defend buyers from fraud, and maintain our capital markets the envy of the world,” SEC Chair Paul Atkins wrote in response to the report.
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Banking rules must be eased, clearly outlined
Permitting banks the flexibility to custody crypto and supply digital asset providers to clients was a key coverage proposal outlined by the working group.
The group beneficial that banking regulators streamline the method to acquire a bank charter and make the necessities extra clear.
Stablecoins and funds have been additionally outlined within the report, relating the necessity to embrace stablecoins to protect the US dollar’s hegemony.
As anticipated, the authors urged Congress to move the CBDC Anti-Surveillance State Act and prohibit the analysis and improvement of a central financial institution digital forex within the US.
Nevertheless, the report highlighted most of the options that make stablecoins indistinguishable from CBDCs.
“A singular function of stablecoins is that stablecoin issuers can coordinate with legislation enforcement to freeze and seize belongings to counter illicit use,” the authors wrote.
Establishing clear rules round taxation
Lastly, the report beneficial that Congress set up a custom-tailored tax policy for cryptocurrencies that accounts for the distinctive options of the asset class, together with staking.
“Laws must be enacted that treats digital belongings as a brand new class of belongings topic to modified variations of tax guidelines relevant to securities or commodities for federal earnings tax functions,” the report stated.
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