US Congress adopts bill banning digital coins from securities legislation

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A bill to exempt digital currencies from being defined as shares has been reintroduced in the U.S. Congress. The Token Taxonomy Act will also exclude swaps between digital currencies from taxes and adjust the tax arrangement for digital currencies in an individual retirement account.
Rep. Warren Davidson (R-Ohio) proposed the bill for the first time in 2018. Since it failed to float through Congress, he did some small tweaks before reintroducing it in 2019, but failed to do so. The bill is now being reintroduced by the senator for the third time.

In a statement by his office, Davidson confirmed that he hopes the bill would offer much-needed transparency for the U.S. blockchain ecosystem. The new regulatory structure in the United States is causing doubt and resentment towards the industry, he added.”Without a workable federal regulatory system, many companies and developers take their businesses overseas where simpler and more friendly regulations have built vibrant blockchain economies,” reads the document.

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Florida Rep. Darren Soto is one of the lawmakers who is sponsoring the measure. Soto was one of the guest speakers at CoinGeek Live, talking about the need to strike a balance between legislation and creativity.Soto said,

“It is time for the United States to step up and lead in blockchain technology. This is an important first-step to promoting innovation and maximizing the potential of virtual currencies for the U.S. economy, all while protecting customers and the financial well-being of investors.”

North Carolina Rep. Ted Budd, Pennsylvania Rep. Scott Perry and New Jersey Rep. Josh Gottheimer have co-sponsored the measure.

The Blockchain Association, a non-partisan group that advocates constructive public policies for the industry, endorses the measure. In the past, the Association blamed the SEC for treating the market.

“It is our opinion that SEC has not been able to offer the assurance needed to stimulate sustained investment and growth in this technology. The Token Taxonomy Act will eradicate this confusion,” the Association said in a blog post.He added, “The bill is a critical move forwards in a regulatory framework that will enable the U.S. to compete, particularly against those increasingly crypto-friendly foreign jurisdictions.”

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