The Senate Agriculture Committee held an important hearing last week to discuss the Digital Commodities Consumer Protection Act (DCCPA), a bill to regulate crypto spot markets.
The heart of the bill is to center jurisdiction over crypto spot markets to the CFTC. The bill reflects a bipartisan consensus that the CFTC is the proper regulator for crypto. The DCCPA gives the CFTC authority to regulate trades in a new asset type, a “digital commodity.” The bill aims to provide the CFTC authority to regulate a new entity category, a “digital commodity platform,” including: brokers, dealers, custodians, and trading facilities (exchanges).
In addition, the bill requires digital commodity platforms to prohibit abusive trading practices, eliminate or disclose conflicts of interest, maintain sufficient financial resources, have strong cybersecurity programs, and protect consumer assets.
DCCPA requires digital commodity platforms to uphold strict advertising standards and disclose information about digital commodities and their risks, increasing transparency and accountability to the marketplace.
Most critically, the bill requires that all digital commodity platforms register with the CFTC. The bill sets a uniform national standard and provides the CFTC with the oversight into the digital asset markets to proactively respond to risks and offer consumer protections.