Latest news with #TimScott
Forbes
2 hours ago
- Business
- Forbes
Senate Crypto Bill Introduces Hybrid Framework For Digital Asset Oversight
Cryptocurrency & Bitcoin on U.S Currency Investments Background with the United States Capitol ... More Building. The Senate Banking Committee released a significant new proposal last week that could reshape how America regulates digital ownership. On July 22, Senators Tim Scott, Cynthia Lummis, Bill Hagerty, and Bernie Moreno released their "Responsible Financial Innovation Act of 2025" discussion draft to solicit public feedback, which takes a notably different approach from the House's recently passed crypto legislation. While the House CLARITY Act handed primary oversight of most digital assets to the Commodity Futures Trading Commission (CFTC), the Senate is proposing a more complex hybrid approach. As the discussion draft explained, they want the Securities and Exchange Commission (SEC) to handle exemptions and disclosure requirements for a new category called "ancillary assets," while the CFTC would still regulate these assets as commodities—a nuanced framework that could unlock new possibilities for community-based blockchain projects that have struggled to find their regulatory footing. It is a fundamentally different philosophy about how digital assets should integrate into America's financial infrastructure. Where the House sees commodities requiring CFTC oversight, the Senate sees a more nuanced landscape demanding SEC expertise, as well. A Regulatory Chess Match The divergence isn't accidental. Although the House passed its CLARITY Act last week with bipartisan support, it seemed like crypto finally had its regulatory roadmap, the Senate Banking Committee, led by Chairman Tim Scott (R-S.C.) and Digital Assets Subcommittee Chair Cynthia Lummis (R-Wyo.), has long pursued a different approach. "My colleagues and I in the House and Senate share the same goal: to provide clear rules of the road for digital assets that protect investors, foster innovation, and keep the future of digital finance anchored in America," Scott remarked in announcing the discussion draft. However, the 35-page proposal represents more than shared goals. While the Senate's "ancillary assets" approach represents innovative regulatory thinking, it actually builds on a well-established but underutilized foundation of joint SEC-CFTC jurisdiction that dates back to 2000—a framework specifically designed for products that don't fit neatly into traditional securities or commodities categories. The Commodity Futures Modernization Act of 2000 first established this hybrid model when it created "security futures products" that were defined as both securities under federal securities laws and futures under the Commodity Exchange Act. Dodd-Frank expanded this precedent with "mixed swaps" that require both agencies to "jointly prescribe such regulations … as may be necessary." The agencies have formalized coordination through MOUs since 2004, most recently updated in 2018 for swaps oversight. The Senate's ancillary assets framework isn't creating new authority, it's adapting the proven CFMA hybrid model for digital assets that similarly defy traditional categories. Threading the Political Needle This nuanced approach directly addresses Democratic concerns that crypto legislation could become a backdoor for avoiding investor protections. Senator Elizabeth Warren (D-Mass.) has repeatedly warned that broad commodity classifications might let companies evade securities laws simply by tokenizing traditional investments. The ancillary asset framework acknowledges these concerns while recognizing that many blockchain-based projects—with their dynamic, programmable nature— genuinely do not resemble traditional securities. It's a more sophisticated approach than the House's broader commodity classification, potentially building the bipartisan support essential for navigating the Senate's 60-vote threshold requirement. Beyond market structure, the bill tackles illicit finance head-on with provisions requiring examination standards for digital assets and encouraging private sector partnerships with federal law enforcement. The legislation also promotes "responsible banking innovation" by ensuring financial holding companies can use digital assets and distributed ledger systems for any activity banks are otherwise authorized to provide. "For too long,' explained Senator Hagerty, 'outdated laws and regulatory uncertainty around digital asset market structure have hindered American innovation and left consumers without adequate protections." The discussion draft "demonstrates a strong commitment to unlocking the full potential of the digital asset economy by delivering responsible legislation that reflects input from stakeholders," Hagerty stated. Implementation Reality Check Senator Scott has set a September deadline for finalizing market structure legislation, but that goal seems ambitious with the political tenor and climate on the Hill. Congress faces a packed agenda including farm bills, defense authorization, and government funding battles. Industry observers suggest crypto legislation may realistically slip into early 2026. That delay might be beneficial. The discussion draft format signals genuine interest in stakeholder input, with the Banking Committee soliciting feedback through early August. This collaborative approach contrasts sharply with the regulation-by-enforcement strategy that characterized previous crypto oversight. The timeline also provides space for harmonizing House and Senate approaches. Both chambers recognize that clear rules beat regulatory uncertainty, but they're debating optimal structures. The House emphasizes commodity regulation and streamlined oversight. The Senate maintains SEC prominence with targeted exemptions. Market Forces and Community Impact Financial markets have already responded positively to regulatory clarity signals. Bitcoin reached new all-time highs following the GENIUS Act signing, and the total crypto market now exceeds $4 trillion. Major banks are announcing digital asset custody services, signaling institutional acceptance of technologies that communities have already embraced. But the real opportunity transcends individual wealth accumulation. The ancillary asset framework could enable blockchain-based community development that honors cooperative economics principles while leveraging cutting-edge technology. It acknowledges that tokenized ownership, democratic governance, and creator economies represent genuinely new economic models requiring new regulatory approaches. Therefore, the stakes riding on this legislation extend well beyond crypto markets. According to latest data, global crypto adoption grew 13% in 2024, reaching 659 million owners worldwide, with Bitcoin ownership expanding to 337 million users. In the U.S. specifically, research shows that 67% of current crypto owners plan to buy more in 2025, while 14% of non-owners plan their first purchases. Communities that have found economic opportunity in digital assets need regulatory certainty to build sustainable wealth-creation systems. Recent Kraken research found that 88% of crypto holders plan to continue investing over the next 12 months, with crypto becoming the preferred asset class for 53% of holders—a significant jump from just 36% the previous year. Without clear frameworks, this innovation and community wealth-building migrates to friendlier jurisdictions. The Bigger Picture The Senate's approach reflects growing recognition that crypto regulation requires nuance rather than broad categorization. Digital assets encompass everything from speculative meme coins to legitimate community development tools. One-size-fits-all regulation serves neither innovation nor investor protection. The ancillary asset concept represents regulatory evolution—acknowledging that blockchain technology creates new forms of value and ownership that don't fit traditional definitions. It's the kind of forward-thinking approach America needs to maintain leadership in digital finance while protecting all participants. The discussion draft format signals senators want genuine input before finalizing their regulatory strategy, with a comprehensive Request for Information covering regulatory clarity, investor protection, trading venues, custody, illicit finance, banking innovation, and preemption issues. The comment period runs through early August, providing stakeholders meaningful voice in shaping legislation that will govern digital assets for years to come. The question remains whether America can create frameworks that enable new forms of community empowerment and economic participation while maintaining the investor protections that also instill trust in the financial system. The answer will determine whether digital assets fulfill their promise of financial inclusion or remain a niche market for sophisticated traders. That long-awaited sophistication could make all the difference.
Bloomberg
3 days ago
- Business
- Bloomberg
Fed Says It Was ‘Honored' by Trump's Tour of Building Site
The Federal Reserve released a statement Friday thanking President Donald Trump and Republican lawmakers for visiting the central bank's renovation project on Thursday. 'The Federal Reserve was honored to welcome the President yesterday for a visit to our historic headquarters,' the Fed said in the statement. 'We appreciated the opportunity to share progress on the renovation with him and with Senators Tim Scott and Thom Tillis. We are grateful for the President's encouragement to complete this important project.'
Fox News
4 days ago
- Business
- Fox News
Trump urges federal interest rates to come down during Federal Reserve visit
President Donald Trump and Sen. Tim Scott, R-S.C., discuss why the Federal Reserve needs to drop interest rates on 'The Will Cain Show.'
Bloomberg
4 days ago
- Business
- Bloomberg
GOP Senator Demands More Information From Fed Over Renovation
Senator Tim Scott has asked Federal Reserve Chair Jerome Powell to provide more information about the $2.5 billion renovation of the central bank's headquarters in Washington, adding to mounting scrutiny the institution is facing over the project. In a letter sent to Powell late Wednesday, the South Carolina Republican said there were 'distinct differences' found when comparing the only publicly available plans for the renovation, Powell's recent congressional testimony on the project and information on the Fed's website. The letter followed a July 17 meeting about the renovation between staffs of the Senate Banking Committee, which Scott chairs, and the Fed.
Yahoo
6 days ago
- Business
- Yahoo
Senate Releases Answer to Clarity Act as It Continues Market Structure Work
The U.S. Senate is marching on in its effort to craft rules and regulations for the vast majority of the crypto market, releasing a discussion draft of a market structure bill that more clearly defines some of the frameworks the lawmakers are contemplating. The 35-page draft released Tuesday formulates new definitions for digital assets that are not securities, and directs the Securities and Exchange Commission to engage in rulemaking around these assets that would exempt them and their issuers from existing regulations. The bill later directs the SEC and Commodity Futures Trading Commission to engage in joint rulemaking around certain aspects of crypto market activity, such as portfolio margining. The draft follows the introduction of principles from the Senate Banking Committee last month that Chairman Tim Scott said would "serve as an important baseline" for the bill. It largely focuses on the SEC, rather than the CFTC, primarily directing it to engage in rulemaking around ancillary assets and disclosure requirements. As presented, the defines an "ancillary asset" as a digital asset sold "in connection with the purchase and sale of a security through an arrangement that constitutes an investment contract," though the ancillary asset itself would not grant any financial rights to its owner. In creating this definition, the bill already diverges from the House's Clarity Act, which passed with a massive bipartisan vote last week but does not define an "ancillary asset" or lean on that definition the way the Senate bill is. The bill would also let an issuer self-certify that their ancillary asset does not provide any rights that a regular security might. It also allows the SEC 60 days to reject the self-certification if it reviews the asset and finds it does resemble security. "My colleagues and I in the House and Senate share the same goal: to provide clear rules of the road for digital assets that protect investors, foster innovation and keep the future of digital finance anchored in America," Scott said in a statement. "I'm grateful for the hard work of our House counterparts to craft smart, bipartisan legislation, and I look forward to building on their work here in the Senate. Working with President Trump, we can deliver a comprehensive, bipartisan regulatory framework for digital assets.'. Senator Cynthia Lummis, who leads the digital assets subcommittee, similarly said in a statement, "market structure legislation will establish clear distinctions between digital asset securities and commodities, modernize our regulatory framework, and position the United States as the global leader in digital asset innovation." The lawmakers also published several dozen questions for the general public to respond to, asking for input on various aspects of the bill, including how legislation should lean on the draft's discussion of "ancillary assets," whether that definition is useful, what information issuers need to disclose and how intermediaries should be treated. The lawmakers are looking for responses by Aug. 5, giving industry participants and others two weeks to weigh in. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
