Attorney General James urged Congress to pass legislation that would require cryptocurrency companies to "make a series of commitments, including registering with a regulatory body and actively identifying and preventing fraud and scams." 

To address the risks associated with some cryptocurrencies, Attorney General James asked Congress to pass legislation that would:

• require issuers of stablecoins to have a presence in the U.S. and be subject to regulation;
• require backing stablecoins with U.S. dollars or treasuries;
• require platforms to only conduct business with anti-money laundering compliant platforms;
• require issuers and intermediaries to register to ensure accountability, transparency, and basic protections to the public;
• protect against conflicts of interest;
• promote price transparency;
• require platforms and intermediaries to actively identify and prevent fraud and scams; and
• disallow digital assets in retirement accounts. 

These offerings and registrations may involve equity or debt securities of issuers whose operations relate to networks, applications, and/or cryptoassets. These offerings and registrations also may relate to cryptoassets offered as part of or subject to an investment contract.

The statement notes that the Division recognizes that Acting SEC Chairman Mark T. Uyeda formed the Crypto Task Force to help the Commission develop a comprehensive and clear regulatory framework for cryptoassets, including addressing applicable registration and disclosure requirements. The Division is issuing this statement to provide its views during the pendency of these deliberations.

The statement addresses stablecoins that are designed to maintain a stable value relative to the United States Dollar (USD), on a one-for-one basis, can be redeemed for USD on a one-for-one basis (i.e., one stablecoin to one USD), and are backed by assets held in a reserve that are considered low-risk and readily liquid with a USD-value that meets or exceeds the redemption value of the stablecoins in circulation. 

The Securities Clarity Act creates a distinction between "an asset and the securities contract it may or may not be a part of and will enable digital asset projects to reach their full potential in a regulatory-compliant way."

The Act specifies that "any asset sold as the object of an investment contract, now defined as an 'investment contract asset' is distinct from the securities offering it was originally a part of. This definition is technology-neutral and applies to all assets sold or offered that would only be considered a 'security' because of their inclusion in an investment contract."

Congressman Emmer said: "Until we have a clear definition of what is a commodity and what is a security, American innovation will continue to suffer. Entrepreneurs need clarity to calculate risk accurately, create new investment opportunities and grow our economy. Our legislation will help provide these answers and allow American investors to fully participate in digital asset technology without sacrificing consumer protections." 

Congressman Soto said: "This bill will add critical definition and jurisdiction to create certainty for a strong digital asset market in the United States—an important step in maximizing the potential of virtual currencies for the U.S. economy while protecting customers and the financial well-being of investors." 

The full text of the bill is available here.

The full text of the bill is available here