The US has developed the first ever law to protect cryptocurrency exchanges

U.S. Senator Bill Hagerty has introduced a bill aimed at protecting cryptocurrency exchanges from unlawful actions of the Securities and Exchange Commission (SEC) — the first law of this kind in the history of the United States.

As it has become known, the Digital Trade Clarity Act is aimed at establishing clear regulations on two major issues faced by crypto exchanges — the classification of digital assets and corresponding liabilities under current securities laws. «The current lack of clarity in the regulation of digital assets presents entrepreneurs and businesses with a choice: navigate the significant regulatory uncertainty in the United States or move abroad to markets with clear digital asset regulation,» said Bill Hagerty, the bill’s author.

Senator Hagerty is convinced that the adoption of the bill will not only provide «much-needed certainty» for crypto businesses, but also increase the liquidity of the US cryptocurrency market. To become law, the document must be approved by the Senate, the House of Representatives, and the US President.

Cryptocurrency platforms often face lawsuits and accusations from the SEC, which entail inspections, court hearings, and thousands of dollars in damages. For example, 2 years ago, the US Securities and Exchange Commission (SEC) filed a lawsuit against Ripple, accusing the company’s top managers of selling unregistered securities. In its lawsuit, the regulator claimed that the platform’s native XRP token is an investment contract, a special class of securities. However, Ripple’s lawyers stated that the company had never entered into investment contracts with buyers of the digital asset. Recently, Ripple representatives filed a motion for summary judgment.

The largest cryptocurrency exchange Binance also got a bump from the SEC when it was reported in June that the Securities and Exchange Commission had launched an investigation to determine whether Binance Holdings had violated the rules established for securities when it launched its BNB token as part of an initial coin offering (ICO) five years ago. However, a month later, SEC officials said they were not aware of any investigations into Binance.

The cryptocurrency community is so outraged by the regulator’s actions that in August, users created a petition demanding the dismissal of SEC Chairman Gary Gensler. The senior official was accused of obstructing the activities of cryptocurrency investors, non-compliance with the law, and lack of competent supervision over the activities of market makers.