First in The Vault: One of the country’s leading crypto trade associations will release a list of a dozen “principles” for crypto market structure reform this morning.
The document, which you can read here, is a reflection of how Republican control of Washington has transformed the digital asset industry’s priorities in the nation’s capital. Market structure reform is one of the main legislative priorities for the GOP’s financial policy committees in the 119th Congress.
In an interview, Blockchain Association CEO Kristin Smith said market structure reforms via Congress had become an easier lift with Republican control of Washington, thanks to the change in regulators.
“The SEC and the CFTC are likely going to move forward and take certain steps that are clearly already within their jurisdiction,” Smith said. “We’ll be able to focus Congress on the new authorities that are needed in order to do this correctly.”
House lawmakers have said they’re open to changes in market structure legislation. The Blockchain Association has one ask off the bat: The next market structure bill taken up by lawmakers should be simpler than the prior attempt, Smith said.
“We’re in a different political environment now,” Smith said. “We don’t need something as comprehensive and complex as we saw in the last Congress.”
The FIT for the 21st Century Act, a joint project between the House Financial Services and Agriculture Committees last session to change the market structure of crypto oversight, passed the House with more than 70 Democratic votes.
The principles: A lot of the points here will sound familiar. The crypto industry wants the federal government to be “pro-competition” in the digital asset space and come up with policies that protect consumers. “Regulations should provide tailored market intermediation,” the document says.
In fact, tailoring the future regulation of crypto is one of the most consistent themes of this policy outline. The Blockchain Association says policymakers should “focus on financial activities, not other applications of distributed ledger technology.” The industry also wants the government to keep its hands off “non-custodial software and services” and not declare them to be financial intermediaries, which come with certain supervision requirements.
Lawmakers should also stay clear of anything that could affect the liability of open-source software developers. “Liability protections ensure that developers are not held responsible for how their code is used by bad actors, encouraging open-source collaboration,” the doc says.
