S.1223 - Prohibiting Foreign Adversary Interference in Cryptocurrency Markets Act (119th Congress)
Summary
S.1223, the "Prohibiting Foreign Adversary Interference in Cryptocurrency Markets Act," aims to amend the Commodity Exchange Act. The bill seeks to prevent entities organized or established in a foreign adversary from interfering in United States digital commodity markets. It defines key terms like 'digital commodity,' 'digital commodity platform,' and 'foreign adversary' to establish a framework for regulation.
Expected Effects
The primary effect of this bill would be to prohibit digital commodity platforms owned or operated by entities from countries deemed as foreign adversaries from registering with the Commodity Futures Trading Commission (CFTC). This would also allow the CFTC to revoke the registration of any platform if a covered entity acquires ownership. This could lead to a more secure and regulated digital commodity market within the U.S.
Potential Benefits
- Enhanced National Security: Reduces the risk of foreign adversaries using digital commodity markets to undermine U.S. economic interests.
- Increased Market Integrity: Prevents manipulation and illicit activities by foreign entities, fostering a more stable and trustworthy market.
- Protection of Investors: Safeguards American investors from potential exploitation by foreign-controlled platforms.
- Strengthened Regulatory Framework: Clarifies the regulatory landscape for digital commodities, providing clearer guidelines for market participants.
- Reduced Risk of Cyberattacks: Limits the exposure of U.S. digital commodity markets to cyberattacks originating from foreign adversaries.
Most Benefited Areas:
Potential Disadvantages
- Reduced Market Competition: Limiting the participation of foreign entities could reduce competition and innovation in the digital commodity market.
- Potential for Retaliation: Foreign adversaries may retaliate with similar restrictions on U.S. entities operating in their markets.
- Compliance Costs: Digital commodity platforms may incur costs to ensure compliance with the new regulations.
- Limited Market Access: U.S. investors may have limited access to certain digital commodities or platforms that are based in or affiliated with foreign adversary countries.
- Definition Challenges: Defining 'digital commodity' and 'foreign adversary' may lead to legal challenges and unintended consequences.
Constitutional Alignment
The bill's focus on regulating commerce aligns with the Commerce Clause (Article I, Section 8, Clause 3) of the U.S. Constitution, which grants Congress the power to regulate commerce with foreign nations and among the several states. By preventing foreign adversaries from interfering in U.S. digital commodity markets, the bill aims to protect the integrity of these markets and ensure fair trade practices. The definitions provided in the bill appear to be carefully constructed to avoid infringing on individual liberties or rights protected by the Constitution.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).