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U.S. Senator Cynthia Lummis believes that the FTX bankruptcy wouldnât have happened under the Lummis-Gillibrand crypto bill. She stressed: âItâs clearer now than ever before that we need comprehensive regulation in the digital asset space.â
U.S. Senator Cynthia Lummis (R-WY) explained in a series of tweets Monday why the collapsed cryptocurrency exchange FTX wouldnât have gone bankrupt had Congress passed her crypto bill. The cryptocurrency trading platform filed for bankruptcy last week.
The senator from Wyoming has been a supporter of bitcoin for quite some time. She personally owns BTC and believes that bitcoin is something that the Federal Reserve should hold on its balance sheet. She has said repeatedly that the cryptocurrency is an excellent store of value.
She tweeted Monday:
The FTX bankruptcy wouldnât happen under the Lummis-Gillibrand bill.
Lummis and Senator Kirsten Gillibrand (D-NY) introduced the Responsible Financial Innovation Act in June. The two lawmakers described the bill as âlandmark bipartisan legislation that will create a complete regulatory framework for digital assets that encourages responsible financial innovation, flexibility, transparency and robust consumer protections while integrating digital assets into existing law.â
The senator from Wyoming explained in different tweets that the bill addresses âClear property rights (not your keys, not your coins!),â provides âStrong protection & separation of customer assets on an exchange,â and puts âTight limits on digital asset leverage & lending.â In addition, it provides âBankruptcy protection for all customersâ and ensures âTransparency into affiliates and connected organizations of an exchange.â
Lummis also told Cowboy State Daily that the collapse of FTX is not something that could have happened in Wyoming. The senator detailed: âSince 2019, weâve known that affiliate transactions with digital assets are dangerous. And thatâs why it is illegal in Wyoming ⊠In Wyoming, there are strict limits on affiliate transactions such as occurred between FTX and its sister organization called Alameda.â
She described:
The Lummis-Gillibrand bill, for example, requires that an exchange not use customer assets for proprietary trading and maintain 100% of customer assets for withdrawal at all times.
Furthermore, she said the bill ârequires use of an independent bank or trust company as custodian, similar to what would happen now with securities under the SEC and the Commodity Futures Trading Commission.â
Senator Lummis told CNBC Tuesday: âWe need to make sure weâre balancing innovation with consumer protections ⊠Buyer beware, these foreign-based companies are operating under different countryâs laws because theyâre more advantageous to those companies.â
Following the bankruptcy filing of FTX, Lummis tweeted:
Itâs clearer now than ever before that we need comprehensive regulation in the digital asset space.
She emphasized: âSenator Gillibrand and I stand ready with the solution. Itâs time for Congress to pass the Responsible Financial Innovation Act to safeguard Americansâ hard-earned money.â
Other crypto bills that were introduced in Congress this year are the âDigital Commodities Consumer Protection Act of 2022â and the âDigital Commodity Exchange Act of 2022.â
What do you think about the comments by Senator Cynthia Lummis? Let us know in the comments section below.
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