On May 5, leaders of the U.S. House Financial Services Committee and the Agriculture Committee released a discussion draft outlining a federal framework for regulating the U.S. Crypto asset industry.
The draft legislation was released by House Financial Services Committee Chairman French Hill (R-Ark.), Agriculture Committee Chairman Glenn “GT” Thompson (R-Pennsylvania), Financial Services Committee Digital Assets Subcommittee Chairman Bryan Steil (R-Wis.), and Agriculture Committee Commodity Markets Subcommittee Chairman Dusty Johnson (R-South Dakota).
These lawmakers emphasized that the bill aims to coordinate regulatory responsibilities between the SEC and the Commodity Futures Trading Commission (CFTC), while providing legal definitions for key terms in the blockchain and crypto asset markets.
“This discussion draft builds on the bipartisan, bicameral progress made during the 118th Congress and provides a durable framework for protecting consumers and maintaining American leadership in digital innovation,” said Chairman Hill.
He added that the committee intends to take public feedback and work with the administration of President Donald Trump to move toward a final bill.
Digital asset classification
The legislation introduces definitions of core industry concepts, including digital goods, blockchain systems, decentralized governance, permissioned payment stablecoins, and mature blockchain systems.
In addition, the draft also clearly stipulates that distributions made through mining, staking or user rewards, namely "end-user distributions", are neither securities nor sales under current laws.
Chairman Thompson stressed the urgency of legislative clarity, noting that the proposed framework would fill a regulatory gap and provide developers and users with the certainty they have long called for.
The draft law sets out a registration path for digital commodity exchanges, brokers and dealers under CFTC supervision, while allowing the SEC to retain jurisdiction over securities and certain hybrid assets. Entities that engage in custody functions, facilitate transactions or interact with customers must follow the newly defined registration and disclosure procedures.
“This is the beginning of a golden age for digital assets, and the House is leading the way,” said Subcommittee Chairman Steil.
Johnson agreed with this view, saying that the United States must provide a sensible regulatory system to continue to maintain its position as a global center for Crypto asset investment and innovation.
The draft also retains protections for DeFi protocols and self-custody. It stipulates that as long as DeFi trading protocols and messaging systems do not take custody of user funds or exercise discretion, they do not need to comply with traditional financial regulations.
The bill also prohibits the Treasury Department or the Financial Crimes Enforcement Network (FinCEN) from issuing rules that would restrict the ability of individuals to self-custody crypto assets through wallets.
Start the legislative process
The committees have scheduled a joint hearing on May 6 titled “The Future of American Innovation and Digital Assets: A Blueprint for the 21st Century” to kick off formal legislative discussions and gather stakeholder input.
The draft includes provisions for joint rulemaking by the SEC and CFTC, as well as research on DeFi, NFTs, and blockchain infrastructure by expanding the federal agency’s Office of Innovation.
By establishing legal definitions and clear jurisdictional boundaries, the proposed bill aims to eliminate uncertainty regarding the regulation of crypto assets in the United States while encouraging the responsible development and regulation of the digital asset market.
