By Gabriel Joyce
Senator Cynthia Lummis has emerged as a vocal advocate for the crypto industry, countering the Biden administration’s intensified crackdown on digital assets and regulatory bodies’ actions. Amidst growing global regulatory pressure, Senator Lummis vows to defend investor rights and support companies grappling with the evolving regulatory landscape.
Lummis Challenges DOJ’s “Hyper-Aggressive” Position
Senator Cynthia Lummis has strongly condemned the Department of Justice’s (DOJ) “hyper-aggressive” stance regarding the classification of non-custodial software as a money transmission service. Expressing deep concern, Senator Lummis highlighted the contradiction with existing Treasury guidance and the lack of common sense in the DOJ’s argument. She asserts that such a position violates the rule of law and poses a significant threat to fundamental property rights inherent to American citizenship.
Lummis Champions Individual Control Over Keys and Nodes
Senator Lummis has reiterated her unwavering commitment to safeguarding individuals’ rights to maintain control over their cryptographic keys and operate their nodes. She expressed dismay at the Biden administration’s apparent move towards criminalizing fundamental aspects of the Bitcoin network and decentralized finance (DeFi).
This stance aligns with Senator Lummis’s previous disapproval of the Securities and Exchange Commission’s (SEC) escalated crackdown on the crypto industry in 2023. Criticizing the SEC’s actions as both “unnecessary” and “overreaching,” she specifically targeted the agency’s controversial new crypto policy, dubbed “Staff Accounting Bulletin 121,” issued in March 2022.
Furthermore, Senator Lummis actively supported Coinbase in its legal battle against the SEC, filing an amicus brief in favor of the exchange. She argued that the responsibility for crafting crypto regulations should rest with Congress rather than being dictated by the SEC.
Senator Lummis contends that the SEC has overstepped its bounds by seeking to classify nearly all crypto assets as “securities,” thereby encroaching upon Congress’s legislative authority and operating beyond the agency’s jurisdiction. Her vocal opposition underscores her commitment to ensuring a regulatory environment that fosters innovation while protecting individual freedoms in the crypto space.
Senator Lummis Calls for Clarity in Crypto Regulation
Senator Lummis has issued a call to action for the establishment of clear regulatory guidelines following Judge Analisa Torres’ ruling that XRP should not be classified as a security. This ruling has reignited debate around the Howey Test, a legal standard used to assess whether an investment constitutes a security.
Senator Lummis emphasizes the importance of preserving the integrity of the Howey Test while acknowledging the necessity of applying it appropriately to digital assets. To address these challenges, Senator Lummis, in collaboration with Senator Kirsten Gillibrand, has introduced the Lummis-Gillibrand bill.
This legislation seeks to provide regulatory clarity for digital assets like XRP by aligning their treatment with the interpretation of the Howey Test as established by the Southern District of New York. By proposing clear guidelines, Senator Lummis aims to foster a regulatory environment that promotes innovation while ensuring investor protection within the crypto market.
