The Security Clarity Act will apply to all assets both tangible and digital, it will also add critical definition and jurisdiction to create certainty for a strong digital asset market in the United States.
On July 15, members of Congress submitted a bipartisan bill with the purpose of giving a precise definition of assets under current securities law, such as digital tokens and other developing technologies.
Reps. Tom Emmer (R-MN), Darren Soto (D-FL), and Ro Khanna presented the bill, dubbed the Security Clarity Act (D-CA). This bill aims to change the meaning of a phrase that has been in use for over 75 years. Any asset sold as an “investment contract” would gain the status of an “investment contract asset.”
This measure, according to the press release, would provide a remedy for people who have met current securities registration requirements or qualified for an exemption. Entrepreneurs would be allowed to disperse their assets without fear of new regulatory constraints if they met these standards.
“There has been an unreasonable approach by regulators as to how federal securities laws should be applied to transactions involving the sale of blockchain-based tokens, and this lack of clarity is hurting American innovation. Between regulation by enforcement and the varying legal decisions regarding the classification of these assets, regulatory uncertainty has hindered the growth of blockchain technology, leaving many to take the technology overseas,”
According to the representative, the Securities Clarity Act is intended to be a technology-neutral bill. It applies to all assets, tangible and digital, and stipulates that an investment contract asset, such as a digital token, is separate and distinct from the offering in which it was included.
“As Congress works to protect those who invest in this technology, the Securities Clarity Act will add critical definition and jurisdiction to create certainty for a strong digital asset market in the United States. This is an important first-step in promoting innovation and maximizing the potential of virtual currencies for the U.S. economy, all while protecting customers and the financial well-being of investors,”
Congressman Soto has previously expressed his concern about regulation interfering with Americans’ ability to benefit from bitcoin.
“Over the last few years I’ve been fortunate to meet with many great crypto and blockchain innovators. A common refrain during our discussion is that they so badly want to develop their crypto and blockchain ideas right here in the United States. But they don’t because of continuing uncertainty with crypto regulation.”
The launch of this measure comes one day after Chairman of the Federal Reserve Jerome Powell addressed to the House of Representatives about the need for stricter regulation of stable currencies, according to a hearing held by the US House committee on financial services in June.