Crypto market participants have welcomed proposed legislation from US Senators that would give the Commodity Futures Trading Commission power to regulate digital commodities.

On August 3 U.S. Senators Debbie Stabenow (D-MI), Chairwoman of the Senate Committee on Agriculture, Nutrition, and Forestry, and John Boozman (R-AR), Ranking Member, along with Senators Cory Booker (D-NJ) and John Thune (R-SD) introduced the Digital Commodities Consumer Protection Act of 2022 to give the Commodity Futures Trading Commission new tools and authorities to regulate digital commodities.

Crypto markets aren’t fair or transparent – putting Americans’ money at risk. @JohnBoozman, @SenBooker, @SenJohnThune, and I are giving @CFTC what they need to protect consumers, prevent fraud and create transparency and accountability.https://t.co/d986y4Rjf1

— Sen. Debbie Stabenow (@SenStabenow) August 3, 2022

Senator Boozman said in a statement digital assets and blockchain technology have already, and will continue, to change the way global markets function but is currently governed largely by a patchwork of regulations at the state level which is not an effective way to protect consumers from fraud.

“Rrelying solely on state regulation does not ensure that rules and regulations work for all stakeholders,” Boozman added. “Our bill will empower the CFTC with exclusive jurisdiction over the digital commodities spot market, which will lead to more safeguards for consumers, market integrity and innovation in the digital commodities space.”

An overview of the legislation can be found here.

A section by section description of the legislation can be found here.

A copy of the bill text can be found here.

Sam Bankman-Fried, chief executive of crypto exchange FTX, said:

2) The bill, cosponsored with @CoryBooker and @SenJohnThune, is complementary with the @CongressmanGT / @RoKhanna house bill and the previously released @gillibrandny / @SenLummis bill.

It would provide clear federal oversight to digital asset commodity markets.

— SBF (@SBF_FTX) August 3, 2022

4) It's also really inspiring to see our senators working in a bipartisan, constructive way to help strengthen America's regulatory frameworks. They and our regulators have developed a strong understanding of the digital asset ecosystem and how to effectively regulate the space.

— SBF (@SBF_FTX) August 3, 2022

Faryar Shirzad, chief policy officer at US-listed crypto exchange Coinbase, said:

2/ DCCPA creates a much-needed federal regulatory regime for crypto, which is a big deal. It's a balanced bill that protects consumers, and affirms that top Ds and Rs in Congress understand the importance of digital asset commodity markets and the need for regulatory clarity.

— Faryar Shirzad (@faryarshirzad) August 3, 2022

4/ A reg regime that protects users, provides clear rules, and allows for innovation will be a win-win, and advance the goals of @POTUS's crypto EO and ensures that the US keeps up with the advances other markets are making in crypto policy https://t.co/bwkiu48bX9

— Faryar Shirzad (@faryarshirzad) August 3, 2022

Jake Chervinsky, head of policy at the Blockchain Association, said:

2/ The heart of the bill is a requirement that "digital commodity platforms" like exchanges & brokers register with the CFTC & follow certain rules aimed at protecting consumers, disclosing risks, & preventing manipulation.

Sounds reasonable! Most people are on board with this.

— Jake Chervinsky (@jchervinsky) August 3, 2022

4/ The devil's in the details & the bill does raise some issues to be addressed, like if its definition of "digital commodity platform" is too broad.

I agree with @valkenburgh & @coincenter on this, but as Peter says, the bill's authors definitely get it:https://t.co/yAo6LaUyop

— Jake Chervinsky (@jchervinsky) August 3, 2022

The Crypto Council for Innovation, a trade body, said:

2/ We commend this example of #bipartisan leadership and the recognition of the incredible amount of nuance in this space. We look forward to working with more forward-thinking policy makers on next steps.

— Crypto Council for Innovation (@crypto_council) August 3, 2022

4/ In addition to focusing on commodities, it commissions a report on historically underserved customers to examine the racial, ethnic, and gender demographics of those using #DigitalAssets

— Crypto Council for Innovation (@crypto_council) August 3, 2022

Rostin Behnam, chairman of the CFTC, said in statement: “As American investors continue to demonstrate growing interest in digital assets, there is a greater need to bring these markets within the regulatory fold.  We are at a critical inflection point where new legislative authority is needed to clarify ambiguities and provide a regulatory framework to the digital commodity market that protects customers, provides market integrity and certainty, and ensures financial stability.

REMARKS: Statement of @CFTCbehnam on the introduction of digital commodity regulation legislation: https://t.co/x3Jf0AiPGW

— CFTC (@CFTC) August 3, 2022

However Better Markets,  the non-profit, non-partisan organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, disagreed that the CFTC should be given jurisdiction over crypto.

In June, we voiced concerns for another Senate bill that would also give the @CFTC jurisdiction over #crypto, noting that the crypto industry "wants the @CFTC as its regulator because it is the smallest financial regulator with the smallest budget." https://t.co/tHjwaAnQIM

— Better Markets (@BetterMarkets) August 3, 2022

Dennis Kelleher, president and chief executive of Better Markets, said in a statement: “The financial industry and its allies in Congress have made sure that the CFTC has been chronically underfunded for decades. While the professionals at the CFTC do an outstanding job with what little they are given to work with, they cannot fulfill their current responsibilities. It will be beyond hopeless if they are also given responsibility for a vast, growing, and technically complex industry like crypto on top of all that.”