In brief
- A crypto bill expected to drop this month is likely to have Democratic co-sponsors.
- Democrats signing the bill could bring new momentum to efforts to clarify crypto laws.
In a move that could bolster support for the cryptocurrency industry in Washington, D.C., at least one Democratic senator is poised to co-sponsor a key piece of legislation being drafted by Cynthia Lummis, a Wyoming Republican and a long time Bitcoin holder.
According to a source familiar with the matter, the legislation is likely to be co-sponsored by one or two Democratic senators who represent states on either coast.
If this comes to pass, it would let the bill’s supporters brand the effort as bipartisan—an important potential development given the highly partisan atmosphere in Congress, and given how Democratic leadership has been largely hostile to crypto.
The Lummis legislation, which could drop as soon as this week, is expected to propose rules that will clarify the role of the SEC and other agencies when it comes to overseeing crypto, and to provide definitions that will mean many popular tokens are not securities. The law also likely would create a so-called de minimus exemption for crypto transactions of a few hundred dollars or less—a measure that would mean people could use crypto for small purchases or transfers without triggering tax obligations.
If Democratic senators do attach their names to the bill, it could help change perceptions in the crypto industry that the party is out to get them—a perception fanned by aggressive rhetoric from the likes of Biden-appointed SEC Chairman Gary Gensler, and by the powerful Senator Elizabeth Warren (D-Ma).
The names of the potential Democratic co-sponsors are being kept under wraps, but one potential candidate is Sen. Kirsten Gillibrand of New York. While Gillibrand’s name has rarely come up in crypto conversations in Congress, she has ties to her home state’s Wall Street-based financial industry, which has increasingly embraced the potential of blockchain.
And more significantly, Politico announced it’s hosting a crypto event featuring both Lummis and Gillibrand that’s sponsored by New York-based crypto services giant Grayscale:
Gillibrand’s office didn’t immediately respond to a request for comment on whether the senator may co-sponsor the Lummis bill.
Another Democrat who could conceivably join the bill is Sen. Ron Wyden of Oregon, who worked with Lummis to oppose provisions in a 2021 infrastructure bill that many perceived as damaging to the crypto industry. Wyden’s office didn’t immediately respond when contacted by Decrypt.
Even if Lummis’s bill is introduced with bipartisan support, the legislative process is such that it would likely take years to pass. But in the meantime, support from Democratic senators would not only provide momentum, but potentially nudge the party’s leadership to become less adversarial to crypto—a position unpopular with voters, especially the growing number of younger voters and people of color who own crypto.
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