Background
The Digital Chamber (TDC) applauds Congressman John Rose (R-TN) for introducing the Bridging Regulation and Innovation for Digital Global and Electronic Digital Assets (BRIDGE) Digital Assets Act—a significant step toward establishing a clear and unified regulatory framework for digital assets in the U.S. The bill aims to bridge the regulatory gap between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) by fostering collaboration through a newly created Joint Advisory Committee (JAC).
Cody Carbone, President of The Digital Chamber, said, “It’s essential that both the SEC and CFTC work alongside industry stakeholders on digital assets, especially as innovation rapidly outpaces outdated regulations. While it’s unfortunate that legislation is needed to restore the collaborative spirit we once had, we’re grateful for Rep. Rose’s leadership in introducing the BRIDGE Digital Assets Act. This bill ensures that regulatory clarity is achieved through direct input from those driving innovation, allowing the U.S. to lead responsibly in the digital asset ecosystem.”
Key Provision
Establishment of a Joint Advisory Committee (JAC):
The JAC will be formed to advise both the SEC and CFTC on rules, regulations, and policies related to digital assets. It aims to create regulatory harmony between the two agencies, addressing long-standing gaps and reducing conflicting oversight.
Focus Areas for Regulation:
The JAC will provide expertise on key digital asset issues such as:
- Decentralization
- Functionality
- Information Asymmetry
- Security
Diverse Industry Representation:
The JAC will include 20 nongovernmental stakeholders representing digital asset issuers, registered entities, academic researchers, and users. These members will serve two-year terms, ensuring that diverse industry voices are included in regulatory decisions.
Implementation Timeline:
The SEC and CFTC are required to:
- Establish a joint charter for the JAC within 90 days of the bill’s enactment.
- Appoint members within 120 days.
- Convene the first JAC meeting within 180 days of enactment, with regular meetings to follow at least twice a year.
TDC Take
The Digital Chamber firmly supports the BRIDGE Digital Assets Act for its ability to finally bring much-needed coherence and collaboration to digital asset regulation. By involving key industry stakeholders through the Joint Advisory Committee (JAC), this bill ensures that those who understand the complexities of digital assets are part of the regulatory process. This shift from regulatory uncertainty to informed guidance not only enhances protections for consumers but also promotes innovation within a stable framework.
It is crucial to return to the effective model of the earlier Joint Advisory Committee (JAC) that expired in 2014. The joint CFTC-SEC Advisory Committee on Emerging Regulatory Issues was established in 2010 by the CFTC and SEC to develop recommendations on emerging and ongoing issues relating to both agencies.
Unfortunately, while this earlier effort proved effective in fostering collaboration, it expired, leaving a gap in consistent oversight. It is disappointing that we now need legislation to restore this collaborative spirit, but the urgency of today’s challenges in the digital asset space demands such action. e leader in the capital markets of tomorrow.