Secure and Fair Enforcement Banking Act of 2020 (SAFE Banking Act) is currently being discussed among government officials QouteCoin
New York City: The “Secure and Fair Enforcement Banking Act of 2020” (SAFE Banking Act) is currently being discussed among government officials. The SAFE act would provide a safe harbor for banks to lend to the cryptocurrency industry, which could be a boon for digital asset companies looking to get funding. However, there are some differences between this new bill and previous ones such as the Token Taxonomy Act by Rep. Warren Davidson which he co-authored with Rep. Brad Sherman in 2018.
A new draft bill, the “Secure and Fair Enforcement Banking Act of 2020” (SAFE Banking Act), is currently being discussed among government officials.
A new draft bill, the “Secure and Fair Enforcement Banking Act of 2020” (SAFE Banking Act), is currently being discussed among government officials. The bill is being considered in the context of the crypto industry and specifically addresses concerns about its role in securitizing assets without issuing traditional bank notes or coins.
The SAFE Banking Act would require US-based cryptocurrency exchanges to register with the SEC, which would allow them access to public funding through other means besides selling equity securities. It also mandates that these exchanges maintain banking relationships with banks that provide credit lines within their own jurisdiction; this provision will likely be controversial as many individuals prefer peer-to-peer lending over traditional banking institutions due to lower interest rates on loans offered by lenders like PayPal Credit or Citibank.
The SAFE act would provide a safe harbor for banks to lend to the cryptocurrency industry.
The SAFE act would provide a safe harbor for banks to lend to the cryptocurrency industry. The act’s framework is similar to previous bills such as the “Token Taxonomy Act,” which was introduced by Rep. David Schweikert (R-Ariz.) and Sen. Rand Paul (R-Ky.) in January 2018 and would have created an exemption from federal taxes on profits made by companies that sell their own products using tokens or coins issued on a blockchain platform like Ethereum or Bitcoin Cash—but it did not pass due to opposition from some Democrats who felt it was too broad-reaching and could lead to unintended consequences like allowing online casinos off shore from paying state licensing fees or taxing transactions conducted via cryptocurrencies as regular property sales rather than securities transactions like stocks or bonds do today.
If signed into law by President Trump, these changes will make it easier for banks like JPMorgan Chase & Co., Wells Fargo & Co., Bank of America Corp., Citigroup Inc., TD Securities LLC LLC (formerly known as Merrill Lynch) etc…to offer loans backed by crypto assets instead of fiat currencies because they won’t have restrictions placed upon them if they want access
The act’s framework is similar to previous bills such as the “Token Taxonomy Act,” whose co-author, Rep. Warren Davidson, told Cointelegraph he is supportive of this new bill.
The act’s framework is similar to previous bills such as the “Token Taxonomy Act,” whose co-author, Rep. Warren Davidson, told Cointelegraph he is supportive of this new bill.
- The Token Taxonomy Act was introduced in 2019 by Rep. Warren Davidson (R-OH) and was co-authored by several other lawmakers including Rep. Carolyn Maloney (D-NY). It would bring order to cryptocurrencies and set up regulations that could help protect consumers from falling victim to fraud or theft by criminals using these assets as their primary means of financial transactions.*
However, the SAFE Act may not be as inclusive as some in the crypto industry would like.
However, the SAFE Act may not be as inclusive as some in the cryptocurrency industry would like. The bill does not provide clarity on some of the current murkiness surrounding cryptocurrencies and their legal status. For example, while it establishes that “virtual currency” is money, it doesn’t address concerns about money laundering or terrorism financing—both areas where regulators are currently concerned about how crypto can be used to engage in criminal activity. As such, it’s unclear whether or not these new rules will help prevent criminals from using crypto for illicit purposes under current laws (they might).
While there are similarities with other bills, it appears that this new bill has no intention of offering clarity on some of the current murkiness around cryptocurrencies.
If you’re a crypto enthusiast, you may have noticed that there are similarities between the SAFE Act and other bills in the crypto space. For example, it appears that the new bill has no intention of offering clarity on some of the current murkiness around cryptocurrencies.
While there are similarities with other bills, it appears that this new bill has no intention of offering clarity on some of the current murkiness around cryptocurrencies. In fact, many members of DeFi have been vocal about their concerns with what they see as “token taxonomy” being used as an excuse not to regulate securities offerings rather than provide more clarity on what constitutes an equity token or utility token (or maybe even both).
How the final draft of this bill turns out could have huge repercussions for DeFi.
DeFi is a relatively new concept, but it’s gaining traction in the crypto community. It’s a way of using blockchain technology to create a more efficient financial system that can be used by anyone, not just those with access to traditional banking.
DeFi could be a boon for the industry as whole and many expect this final draft of this bill will pave the way for further regulation around cryptocurrency exchanges and wallets, which would allow authorities more control over how these services operate.
The SAFE Banking Act is still in draft form, so we don’t know what will ultimately be included or excluded. However, it appears that this bill could have huge ramifications for DeFi by providing a legal framework for banks to lend to the cryptocurrency industry. If passed, it would bring clarity and stability to the market while also offering protection from anti-money laundering practices and government oversight.
