Senator Cynthia Loomis (R-WY) has unveiled a sweeping US bill to legalize and regulate cryptocurrency. Its lead advisor to the initiative, MicroStrategy CEO Michael Saylor, believes that bitcoin is a commodity, not a security.
The US crypto bill appears to have a boost among crypto industry insiders with Bitcoin caps and the Ethereum/DeFi/Web 3.0 suite. It has bipartisan support sponsored by Kirstin Gillibrand (D-NY) and Ted Cruz (R-TX).
What could be the reason why US Cryptocurrency Law classifies Bitcoin and other cryptocurrencies as commodities and not as securities?
It is clear that Bitcoin will be classified as a commodity
Because in promoting the bill prior to its unveiling, Senator Loomis said that if passed, it would distinguish between commodities, securities, stablecoins, central bank digital currencies, and NFTs.
The fact that there will be a distinction between commodities and securities leaves Bitcoin with the most important property of the commodity.
Bitcoin is like a commodity in its price fluctuations due to the demand for a rare digital commodity with global macroeconomic prices correlating with energy prices and inflation generated by computing platforms running BTC mining software that anyone can download.
Other cryptocurrencies, mainly buy/throw shares that can act not only as a cash payment and banking system, but smart cash with features such as voting rights incentives in sophisticated and smart blockchain governance by contract that affects its value, are very similar Publicly traded stocks Securities in companies.
But US Senator Loomis’ crypto bill would treat most cryptocurrencies as commodities.
Saylor was the “first pair of eyes” on the bill
But the real strong indication that the bill would classify bitcoin as a commodity is that the chief adviser to Senator Loomis and “First Sight” was MicroStrategy’s CEO and advocate for regulatory clarity for cryptocurrency, Michael Saylor.
Loomis said of Saylor’s assistant:
“Michael Saylor was the first to see it because his experience is so long lasting and we want to make sure we have plenty of information before we drop it.”
And in a recent interview on Lex Friedman’s popular tech and science podcast on YouTube, the CEO of MicroStrategy was very determined to distinguish bitcoin, stocks, and even other cryptocurrencies as a commodity. He repeatedly insisted that Bitcoin is not the same as security and explained why.
A security is a solid stake in the equity or financial assets of an organization, such as stocks. Bitcoin is not the capital of a specialized company offering a particular commodity in a company to generate profits for its owners.
This is a final settlement in deflationary deposit currency on the most secure custodian network that has been published and designed for this purpose.
Crypto Bill Lobeing Congress
It’s not just Bitcoin fanatics like Michael Saylor who have been in talks with the government over the crypto bill. Myles Jennings, General Counsel for Cryptocurrency and Head of Decentralization for Ethereum Investor Andreesen Horowitz, said of the crypto bill:
This is the starting point for discussions about what the law should apply to. I think that’s one of the reasons we’re excited about it.
So it appears that the legislative offices that drafted the bill have consulted whale-sized leaders on both wings of the crypto industry.
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