US Senators Oppose CBDC, While Crypto Regulations and Taxes Under Review Globally
Summary:
Five U.S. Senators are opposing President Biden's efforts to launch a 'digital dollar', challenging the Federal Reserve's power to create such a Central Bank Digital Currency (CBDC). Meanwhile, the U.S. House Financial Services Committee is battling a Securities and Exchange Commission (SEC) regulation that prevents banks from custodizing cryptocurrencies. SEC Commissioner Hester Peirce calls for less centralization and softer regulation while expressing her views on an array of crypto issues. In Indonesia, authorities are reconsidering their stance on crypto taxation due to the integral role of cryptocurrencies in the economy. A Nigerian government representative has vehemently denied levying a $10 billion fine on Binance, a prominent crypto exchange. Finally, South Korea's ruling People Power Party has indefinitely delayed its plans to ease cryptocurrency restrictions.
A group of five U.S. senators, including Ted Cruz, Bill Hagerty, Rick Scott, Ted Budd and Mike Braun, are opposing President Biden’s attempts to introduce a central bank digital currency (CBDC), or a 'digital dollar'. The lawmakers presented the CBDC Anti-Surveillance State Act to challenge the Federal Reserve's power to establish such a digital currency, which directly contradicts the Federal Reserve's authority to offer specific products or services to citizens and prohibits CBDC use for monetary policy among other purposes.
On a different note, with a new resolution under its belt, the U.S. House Financial Services Committee (HSFC) is taking a stand against a rule instituted by the U.S. Securities and Exchange Commission (SEC) that currently prevents banks from holding custody of cryptocurrencies. The SEC's Staff Accounting Bulletin No. 121, from March 2022, currently requires banks managing crypto assets to record those holdings as liabilities on their balance sheets. The HSFC emphasizes that reversing this rule will benefit consumers by removing barriers that currently stop highly regulated banks from overseeing digital assets.
SEC Commissioner Hester Peirce emphasized during the ETHDenver conference that the U.S. needs less centralization and gentler regulation. Known affectionately as the 'Crypto Mom', Peirce asserts that financial decentralization offers resilience and strength. She also tackled a variety of crypto-focused issues, including the SEC's direction post the 2024 U.S. presidential election, Bitcoin ETFs spot issues, CBDCs, and the threat of governmental financial surveillance.
In related news, Indonesia's Commodity Futures Trading Regulatory Agency (Bappebti) has asked the nation's Ministry of Finance to reevaluate its stance on taxing cryptocurrencies. The staff at Bappebti have requested a review of the 0.11% value-added tax on every crypto transaction and the 0.1% income tax on crypto in the country. They argue that with cryptocurrencies becoming an integral part of the economy soon, it's essential to reevaluate these taxes, which have contributed to a government revenue of approximately $2.49 million in January 2022.
Contradicting recent speculations, a representative of the Nigerian government categorically denied levying a $10 billion fine on Binance, a leading crypto exchange. The accusations, reported by the BBC due to a misquote, were dismissed by Bayo Onanuga, a Nigerian president's special adviser. He clarified that while the potential for fines is present, nothing is confirmed yet. This follows increased regulatory pressures on crypto exchanges in Nigeria with multiple platforms recently banned to protect the Nigerian currency, the naira.
In South Korea, the ruling People Power Party has postponed indefinitely its planned proposal to relax restrictions on cryptocurrencies, including lifting the prohibition on domestic spot Bitcoin ETFs. This turnaround could be due to difficulties in aligning the government and financial authorities on cryptocurrency policies. Although the party had considered postponing crypto profits tax and permitting institutions to release spot Bitcoin ETFs and directly invest in cryptocurrencies, it has removed virtual assets from its upcoming policy priorities.
Published At
3/4/2024 11:30:00 PM
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