Two leading congressional voices on cryptocurrency this week reaffirmed their support for creating a regulatory framework to oversee digital assets and expressed frustration at the slow pace of crypto legislation in Congress.
“I’ve been somewhat frustrated because we need to do work. This is Congress’s job … We should be regulating this industry,” Sen. Kirsten Gillibrand, D-N.Y., said on May 15 at the Blockchain Summit 2024 in Washington, D.C.
“We should be creating the rules of the road,” Gillibrand said, “and we should be able to figure out how to create a sustainable, innovative industry that has the right type of guardrails so that innovation stays in the United States.”
Her colleague across the aisle, Sen. Cynthia Lummis, R-Wy., echoed that sentiment when she spoke during a fireside chat with Gillibrand.
“There is a more well-understood regulatory framework in Europe. And it’s more mature than the United States,” Lummis said. “That’s a terrible shame. This country is the incubator of innovation. We’ve always been that way. And so, to take this particular industry, in its infancy still, and make sure that it doesn’t thrive here, but it thrives elsewhere in the world is really tragic.”
Gillibrand and Lummis teamed up in 2022 on a high-profile Senate bill that sought to set a regulatory landscape for digital assets. The legislation would retain for now the status quo on current Federal oversight of some cryptocurrency trading, but also would set the stage for a much broader examination of how and whether the Federal government should create regulatory structures for a wider range of digital assets that includes cryptocurrency.
The pair re-introduced the bill in July 2023 with changes that they said added consumer protections and safeguards to strengthen the industry against fraud and bad actors.
More recently, in April of this year Gillibrand and Lummis introduced legislation to create a regulatory framework for a more narrow aspect of the digital asset landscape: “stablecoin” cryptocurrencies. They are cryptocurrencies whose value is tied to currencies, commodities, or other financial instruments.
Lummis said at the May 15 blockchain summit that she and Gillibrand were both “getting signals that the stablecoin legislation would have the momentum to move forward.”
But it remains unclear when crypto legislation might move forward in Congress. Although cryptocurrencies rallied earlier this year, with Bitcoin hitting an all-tine high, the industry has been hit by the collapse of some prominent crypto firms.
One was FTX, whose founder, Sam Bankman-Fried, was recently sentenced to 25 years in prison after being convicted of fraud and conspiracy.
Blockchain, the underlying technology behind cryptocurrencies, was also featured at the summit, with Rep. Nancy Mace, R-S.C., calling for passage of her recent blockchain legislation.
The bill would harness blockchain technology for border security operations, instructing the Department of Homeland Security to implement a public blockchain-based system that enhances data security and operational efficiency across U.S. borders.
But like her Senate colleagues, Mace said it can be challenging to get other members of Congress to focus on the industry and its complexities.
“Assessing blockchain technology and Congress can sometimes feel like you’re watching paint dry,” she said. “For some of my colleagues, the very word blockchain is too futuristic. It’s like flying a flying car for them.”
She encouraged members of the crowd to “reach out to your members of Congress or reach out to your U.S. senators and be an active voice in the digital corridor and for blockchain going forward.”