Republican lawmakers distinguish crypto commodities and securities in draft bill
The proposal attempts to set out clear roles for the U.S. SEC and CFTC.
McHenry, Thompson, Hill, Johnson Release Digital Asset Market Structure Proposal - the draft pdf.
The framework under the bill would allow certain digital assets to qualify as digital commodities if they were “functional and considered decentralized” and require the SEC to provide a “detailed analysis” of any objections to a classification of a firm as decentralized.
And thus, the arguments shift to defining "decentralised" - most will fail that test. It also leaves open the possibility that an asset may change from decentralised to centralised depending on ownership. That in itself could be used as an attack to force a coin into compliance with securities laws.
This is a draft proposal.
Let the horse-trading begin - or is it a zebra?
summary of the bill (2 pages) = https://docs.house.gov/meetings/AG/AG00/20230606/116051/HHRG-118-AG00-20230606-SD002.pdf
section breakdown (9 pages) = https://docs.house.gov/meetings/AG/AG00/20230606/116051/HHRG-118-AG00-20230606-SD001.pdf
full bill is 162 pages of legalese.
OK, that's weird - so only network decentralisation, meaning a distributed system, is recognised, and not that the token itself is decentralised. That's just a way of creating new corporations with weaker governance models than current corporate law.
The definition of "manipulation" also needs to be refined. eg every trade using a swap pool will affect the price in a known way, unlike using an open market, and hence every trade could be considered "manipulation".