What does DEFINITIONS UNDER THE COMMODITY EXCHANGE ACT. of Digital Commodity Intermediaries Act do?

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What does DEFINITIONS UNDER THIS ACT. of Digital Commodity Intermediaries Act do?

This section defines several terms used within the Act. The definitions for 'blockchain', 'decentralized finance messaging system', 'decentralized finance trading protocol', 'decentralized governance system', 'digital asset', 'digital commodity', 'digital commodity broker', 'digital commodity dealer', 'digital commodity exchange', and 'mixed digital asset transaction' are derived from section 1a of the Commodity Exchange Act.

What does RULEMAKINGS. of Digital Commodity Intermediaries Act do?

This section mandates the Commodity Futures Trading Commission (CFTC) to issue rules defining specific terms related to digital commodities and related entities. The CFTC and the Securities and Exchange Commission (SEC) are required to jointly issue rules to exempt entities registered with both agencies from duplicative regulations, fostering fair markets and protecting customers. The CFTC and SEC must jointly issue rules applicable to mixed digital asset transactions, including defining the term 'mixed digital asset transactions'. Within 180 days of enactment, the CFTC and SEC must jointly issue rules, procedures, or guidance regarding the delisting of assets for trading. The CFTC and SEC are tasked with jointly issuing rules regarding portfolio margining determinations for various account types, including digital commodity accounts. The CFTC must issue rules addressing conflicts of interest among registered entities and individuals, including those related to vertically integrated market structures. These rules must establish governance, personnel, and financial resource separation among affiliated entities performing distinct regulated functions.

What does EXPEDITIED REGISTRATION FOR DIGITAL COMMODITY EXCHANGES, of Digital Commodity Intermediaries Act do?

This section establishes an expedited registration process for digital commodity exchanges, brokers, and dealers. The Commodity Futures Trading Commission (CFTC) must adopt a process for expedited registration within 180 days of the Act's enactment. Entities registering under this process will initially be in 'provisional status' until 270 days after the final effective date of related rulemakings under sections 5i and 4u of the Commodity Exchange Act. During provisional status, entities must pay fees required under section 8e of the Commodity Exchange Act. Entities in provisional status are subject to the Commodity Exchange Act and applicable rules and regulations. They may continue offering digital assets until the rulemaking on definitions under section 103(a) is effective, except for assets required to be delisted under section 103(e). The CFTC has the authority to exempt persons or classes of persons in provisional status from certain requirements. Beginning 30 days after enactment, entities acting as digital commodity exchanges, brokers, or dealers must disclose to customers that they are not yet registered or regulated by the CFTC.

What does COMMODITY EXCHANGE ACT SAVINGS PROVISIONS. of Digital Commodity Intermediaries Act do?

This section establishes savings provisions for the Commodity Exchange Act (CEA). It states that this Act or its amendments will not affect agreements, contracts, or transactions already subject to the CEA, including futures, options, swaps, and leverage transactions. The activities of persons related to these CEA-covered agreements, contracts, and transactions are also protected. This Act does not authorize digital commodity entities to engage in CEA-covered activities solely due to their registration. Agreements, contracts, or transactions covered by the CEA will not be regulated as digital commodity agreements simply because they use blockchain technology.

What does ADMINISTRATIVE REQUIREMENTS. of Digital Commodity Intermediaries Act do?

This section amends Section 4c(a) of the Commodity Exchange Act. The amendments add 'a contract of sale of a digital commodity' to several subparagraphs and subclauses within paragraph (3) and (4). Changes are made to the language and structure of subparagraph (C) of Section 4c(a)(4), including redesignating clauses and inserting new language. The amendments involve striking certain words like 'or' and periods, and inserting 'or' and '; or'.

What does INTERNATIONAL COOPERATION. of Digital Commodity Intermediaries Act do?

This section directs the Commodity Futures Trading Commission (CFTC) to promote consistent global regulation of digital commodities. The CFTC shall consult and coordinate with foreign regulatory authorities regarding international standards for digital commodity regulation. The CFTC may establish information-sharing arrangements to protect investors, customers, and users of digital commodities.

What does IMPLEMENTATION. of Digital Commodity Intermediaries Act do?

This section outlines the implementation process for the Act. The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) must promulgate rules and regulations within 18 months of the Act's enactment. The CFTC and SEC are authorized to take preparatory actions before the effective dates specified in the Act, including rulemaking, studies, registration, and exemptions. Actions taken by the CFTC or SEC under these preparatory measures cannot become effective before the applicable effective date. Congress expresses the sense that the CFTC should be fully constituted and appropriately staffed to carry out its responsibilities under the Act. The CFTC should have at least two commissioners nominated with consultation from the ranking minority member of the Senate Committee on Agriculture, Nutrition, and Forestry.

What does EFFECTIVE DATE. of Digital Commodity Intermediaries Act do?

This Act, and amendments made by it, generally become effective 18 months after enactment. Certain rulemaking provisions have a delayed effective date. Rulemaking provisions take effect on the later of 18 months after enactment or 120 days after the final rule's publication in the Federal Register.

What does SENSE OF CONGRESS. of Digital Commodity Intermediaries Act do?

This section expresses the sense of Congress regarding the interpretation of the Act. Congress intends that the Act should not authorize regulation of any commodity other than digital commodities. The regulation of spot markets is specifically addressed; Congress does not intend for the Act to authorize such regulation.