Congress will likely decide the fate of crypto jurisdiction: Lummis staffer

cointelegraph.com:

A United States Senator Cynthia Lummis staffer believes that U.S. Congress will have to step in and resolve the dispute between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) regarding who regulates cryptocurrencies if the matter cannot be resolved internally. 

The issue stems from 2014 when the CFTC first asserted jurisdiction over virtual currencies. This was later reaffirmed by a U.S. Federal Court ruling in 2018, which stated that CFTC had jurisdiction to prosecute criminals over fraud cases involving virtual currencies. However, it has been the SEC that has predominantly been investigating U.S.-based crypto exchanges and crypto assets to date.

On Aug. 3, Senators Debbie Stabenow (Michigan) and John Boozman (Arkansas) introduced the Digital Commodities Consumer Protection Act of 2022 (DCCPA). If the bill is passed into law by the U.S. legislature, the CFTC would be granted rights to regulate digital commodities.

Most notably, the DCCPA would class both Bitcoin (BTC) and Ether (ETH) as digital commodities and not securities. This is particularly significant because SEC chairman Gary Gensler recently said in an interview with U.S. business news channel CNBC that BTC is the only cryptocurrency he is comfortable with labeling as a commodity:

But despite the tension, Lummis' staffer thinks the DCCPA bill has less than a 50% chance of being passed this year:

The news comes after the SEC has begun investigating the $20 billion crypto exchange Coinbase, but Lummis' staffer also stated that every U.S.-based crypto exchange is under investigation in some form.

Related: Coinbase SEC investigation could have ‘serious and chilling’ effects: Lawyer

Under U.S. law, the Howey test