Senate Republicans Update Digital Asset Regulatory Framework
The Senate Republicans have released an updated version of the Digital Asset Market Clarity Act, which merges the work of the Senate Banking Committee and the Senate Agriculture Committee. This move is part of Congress's effort to establish a comprehensive federal regulatory framework for digital assets. The new text largely preserves the core frameworks from both committees but adds new provisions on ancillary assets, AI innovation labs, law enforcement, and investor protection.
The bill retains the network token and ancillary asset structure set forth in the Senate Banking Committee's substitute text. It also directs the Securities and Exchange Commission (SEC) to focus on activities relevant to actual control of a distributed ledger system when determining whether persons are acting in concert. The SEC would be required to adopt rules addressing insider trading involving ancillary assets, including trading by control persons and those possessing material nonpublic information.
The Senate version adds provisions relating to AI innovation labs, requiring the Federal Reserve and other financial regulatory agencies to establish or identify a division of their agency that will serve as an AI innovation lab. This would enable regulated entities to experiment with AI test projects without unnecessary or unduly burdensome regulation or enforcement.