House committee leaders issue discussion draft of crypto market structure bill

House Financial Services Committee Chairman Patrick McHenry (R-N.C.) and House Agriculture Committee Chairman Glenn "GT" Thompson (R-Pa.) released a discussion draft of legislation to establish a statutory framework for digital asset regulation.

Details: The discussion draft includes provisions to codify the authority of the Securities and Exchange Commission and the Commodity Futures Trading Commission over digital assets and requires the agencies to develop new rules on crypto oversight. The lawmakers said the draft is designed to provide clarity, fill regulatory gaps, and foster innovation while providing adequate consumer protections.

Securities Exemption: During a series of recent hearings—including a rare joint hearing last month featuring members of both committees—committee leaders have raised concerns about the SEC’s efforts to designate crypto assets as securities. The discussion draft includes exemptions from securities laws for the sale of digital assets that meet certain conditions.

Outlook: The outlook of the discussion draft, which House Democrats have not contributed to, is uncertain. Committee leaders encouraged the public, including market participants, to provide feedback.

Recent Letter: ICBA recently told the House Financial Services Committee that a separate draft stablecoin bill does not go far enough in ensuring nonbank stablecoin issuers are adequately supervised, though it supports that draft bill’s goal of addressing gaps in regulatory authority.

ICBA View: ICBA has repeatedly called on policymakers to ensure new policies directed at the crypto sector fully reflect its risks and to prioritize research on the specific effects of digital assets on community banks and their customers.