Document Could End Years of Legal Uncertainty in the Industry

Republican members of the US House of Representatives have introduced a comprehensive bill designed to create a complete regulatory framework for the digital asset industry. The document clearly delineates the authorities of key regulators—the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC)—thus addressing one of the most pressing issues in the crypto industry. In addition to distributing oversight functions, the bill legalizes token sales, establishes transparency requirements for exchanges, and guarantees users’ right to self-custody of digital assets. Experts note that the proposed initiative could be a turning point for the development of blockchain technologies in the US after many years of regulatory uncertainty.

Clear Division of Powers and a New Licensing System

A key element of the new bill is the detailed separation of responsibilities between the main US financial market regulators. According to the document, the Securities and Exchange Commission (SEC) will be responsible for capital raising, token sales, and public offerings of assets with securities characteristics. In turn, the Commodity Futures Trading Commission (CFTC) will receive authority to control the circulation of digital commodities on exchanges, as well as oversight of brokers and trading platforms.

“We have made significant progress in the 118th Congress in forming bipartisan and bicameral consensus on creating an effective regulatory system for digital assets. The current discussion draft continues this work, providing necessary legal certainty for the digital asset ecosystem, enhancing consumer protection, and strengthening the long-term stability of digital markets in the United States,” said Representative French Hill, the Republican on the House Financial Services Committee.

In addition to allocating control functions, the bill establishes disclosure requirements and describes in detail the process for registering cryptocurrency exchanges. It also provides for the creation of a transparent registration system for companies in the digital commodities sphere.

Given the complexity of immediately implementing the new licensing system, the bill’s authors have provided for a transition period. Until the full launch of the system, market participants will be able to continue their activities by submitting a preliminary notification of their intention to register. As part of this process, regulators will require information about the types of assets, funding sources, fundraising goals, and methods of storing user assets.

“The transition period is a reasonable compromise between the need for regulation and the risk of stifling innovation,” comments David Johnson, partner at Blockchain Law Group. “This will allow existing projects to adapt to new requirements without ceasing operations, while giving regulators time to fine-tune the oversight system.”

From Regulatory Uncertainty to a Structured Approach

The introduced bill emerged against the backdrop of years of uncertainty in digital asset regulation in the US. Over the past decade, the crypto industry has developed in a legal vacuum, where various regulators sometimes imposed contradictory requirements on market participants.

Particularly acute was the confrontation between the SEC and CFTC on the issue of classifying crypto assets and defining jurisdictional boundaries. The SEC under Gary Gensler adhered to a “regulation by enforcement” approach, often asserting that virtually all cryptocurrencies except Bitcoin are unregistered securities. This created an atmosphere of uncertainty and forced many projects to either leave the American market or restrict access to American users.

“For the past five years, we’ve been observing a situation where companies didn’t understand which rules they should follow and which regulator to approach,” notes Sarah Chen, researcher at the Institute for Digital Economy. “This has led to the US beginning to lose leadership in blockchain innovation, giving way to jurisdictions such as Singapore, the UAE, and even some European countries.”

Notably, the new bill includes a clause protecting the mechanism of self-custody of cryptocurrencies. According to the document, no government structure will have the right to prohibit users from independently storing digital assets in their wallets. This clause is particularly important for the crypto community, which views self-custody as a fundamental principle of decentralized finance.

The bill also provides for the creation of innovation offices within the SEC and CFTC, indicating a desire for more constructive engagement with the evolving industry.

Adoption Prospects and Market Impact

Despite the fact that the presented bill is a significant step forward, its path to adoption may prove challenging. Previously, a group of nine Democrats in the US Senate already opposed a separate stablecoin bill (Guiding and Establishing National Innovation for U.S. Stablecoins), indicating persistent disagreements between parties on digital asset regulation issues.

“There is a significant risk that this bill will become hostage to election politics,” warns Michael Adams, a policy analyst from the Washington Center for Digital Policy. “Although both parties generally recognize the need to regulate crypto assets, specific approaches and the strictness of control remain subjects of debate.”

Nevertheless, the very fact of a comprehensive bill’s appearance was positively received by the crypto industry. Against the background of news about the document’s introduction, the rates of leading cryptocurrencies showed moderate growth, reflecting the market’s hopes for an end to the era of regulatory uncertainty.

“Even if the bill is not passed in its current form, the very process of its discussion will contribute to forming a clearer position and developing compromise solutions,” believes Elena Wong, CEO of consulting company Blockchain Advisory Services. “We are observing a gradual movement from a chaotic approach to a structured regulatory environment, which in the long term is favorable for serious projects and institutional investors.”

Experts also note that the adoption of such a bill could have a significant impact on the global regulatory environment, as many countries traditionally follow the US example in matters of financial regulation.

“If the US creates a clear and balanced regulatory framework, it could trigger a domino effect in other jurisdictions,” suggests Robert Kimball, partner at international law firm DLT Legal Advisors. “This is especially true for countries that are currently in the process of forming their own approaches to regulating digital assets.”

Regardless of whether this bill is passed in the current session of Congress, it represents an important benchmark demonstrating the evolution of approaches to regulating the crypto industry in the US—from initial skepticism to recognizing the need to create a favorable environment for innovation while ensuring consumer protection and systemic stability.