Virginia’s Democratic representative Don Beyer has ushered in a fresh bill mandating the documentation of off-chain transactions and over-the-counter (OTC) crypto engagements by cryptocurrency exchanges, to be catalogued in a repository under the purview of the U.S. Commodity Futures Trading Commission.
New Legislation Targets Off-Chain Transfers in Crypto Industry
Representative Don Beyer (D-VA), has unveiled a new legislative piece reportedly aimed at safeguarding stakeholders in the digital assets arena. Titled the “Off-Chain Digital Commodity Transaction Reporting Act,” this bill mandates “trading platforms to report all transactions to a repository registered with the Commodity Futures Trading Commission (CFTC).”
Beyer posits that crypto trading platforms bear the responsibility for “reporting all such transactions to a registered digital asset repository of transactions as soon as technically practicable after the execution of each such transaction.” Under Beyer’s legislation, all off-chain digital asset transactions are to be reported within a 24-hour window. Off-chain transactions may encompass peer-to-peer swaps, OTC trades, and even the simple transfer of reserve assets.
“As consumers increasingly turn to large digital asset trading platforms to conduct their business, thousands of transactions each day are conducted off the publicly verifiable blockchain,” Beyer remarked on Thursday. “Unfortunately, internal record keeping among these private entities can vary wildly, and this can leave investors and consumers vulnerable to fraud and manipulation.
The Virginia-based politician added:
This bill is a common-sense measure to restore some transparency and confidence to the digital asset market.
Beyer’s press release underscored that the advent of crypto trading platforms, coupled with an aspiration to expedite transaction times and diminish costs, leads to thousands of transactions transpiring “off-chain” daily, absent from the public eye on the blockchain.
The bureaucrat posits that numerous platforms uphold internal private ledgers to chronicle transactions, though the integrity of these records can fluctuate. Beyer fervently contends that such inconsistencies might pave the way for disputes, manipulation, or fraud, emphasizing that the objective of this legislation is to shield ordinary investors.
In 2023, Democratic policy architects have set their sights on cryptocurrency markets, with nine U.S. legislators rallying behind U.S. senator Elizabeth Warren’s (D-MA) Digital Asset Anti-Money Laundering Act. Yet, a wave of Democratic voters have expressed disdain for Warren’s and the party’s stance on crypto, declaring their intent to cast ballots against the Democrats due to this issue.
What do you think about the politician’s new bill that would require crypto platforms to submit off-chain records to the CFTC in 24 hours? Share your thoughts and opinions about this subject in the comments section below.