The U.S. Commodity Futures Trading Commission (CFTC) recently published a keynote address by Chairman Rostin Behnam discussing the future of cryptocurrency regulation. Among other observations, Chairman Behnam noted that despite information suggesting that one in every five American adults has invested in or otherwise used cryptocurrency, the market has developed without clearly demarcated regulatory bounds, adding that the recent "crypto winter" has reinvigorated the call for a regulatory approach. Behnam stated that the U.S. digital asset industry does not fall within a single comprehensive regulatory scheme, and later suggested that "as with any trading market, the digital asset market would benefit from uniform imposition of requirements focused on ensuring certain core principles, including market integrity, customer protection, and market stability." Among other statistics, he shared that the CFTC has pursued more than 50 enforcement actions since 2014, including for digital asset-related misconduct, retail fraud involving digital assets, the illegal offering of off-exchange trading in digital assets, and making untrue or misleading statements and omissions. According to Federal Trade Commission information Behnam shared, since 2021 more than 46,000 people have reportedly lost more than $1 billion in cryptocurrency to scams, and top cryptocurrencies used to pay scammers include bitcoin, tether and ether. Behnam pledged that the CFTC would continue using its enforcement authority to protect consumers in the digital asset commodity space from fraud and manipulation.
In another recent development, this week two senators proposed a bipartisan bill that would simplify the application of tax rules to transactions made with digital currencies. According to a press release, under the proposed Virtual Currency Tax Fairness Act, small personal cryptocurrency transactions under $50 would be exempted from capital gains taxation. Under current law, a taxable event occurs every time a digital asset is used. The proposed bill, which received positive reactions from the cryptocurrency industry, reportedly includes an aggregation rule that identifies related sales and exchanges as a single transaction in an effort to prevent potential tax evasion.
For more information, please refer to the following links:
- Keynote Address of Chairman Rostin Behnam at the Brookings Institution Webcast on The Future of Crypto Regulation
- Toomey and Sinema Introduce Bipartisan Legislation to Simplify Use of Digital Assets for Everyday Purchases
- Senate Bill Would Streamline Taxes For Payments With Crypto
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