Lawmakers propose bill for crypto oversight

WASHINGTON — A bipartisan group of senators on Wednesday proposed a bill to regulate cryptocurrencies, the latest attempt by Congress to formulate ideas on how to oversee a multibillion-dollar industry that has been wracked by collapsing prices and lenders halting operations.

The regulations offered by Senate Agriculture Committee chair Debbie Stabenow and top Republican member John Boozman would authorize the Commodities Futures Trading Commission to be the default regulator for cryptocurrencies. That would be in contrast with bills proposed by other members of Congress and consumer advocates, who have suggested giving the authority to the Securities and Exchange Commission.

This year, crypto investors have seen prices plunge and companies crater, with fortunes and jobs disappearing overnight, and some firms have been accused by federal regulators of running an illegal securities exchange. Bitcoin, the largest digital asset, trades at a fraction of its all-time high, down from more than $68,000 in November 2021 to about $23,000 on Wednesday.

The bill by Stabenow, a Democrat from Michigan, and Boozman, of Arkansas, would require all cryptocurrency platforms — including traders, dealers, brokers and sites that hold crypto for customers — to register with the CFTC.

The CFTC is historically an underfunded and much smaller regulator than the SEC, which has armies of investigators to look at potential wrongdoing. The bill attempts to alleviate these issues by imposing user fees on the crypto industry that would in turn fund more robust supervision of the industry by the CFTC.