Lawmakers in the U.S. are discussing a bill that seeks to prevent large technology institutions in the country from issuing cryptocurrencies.
According to a report from Reuters on 15 July and a copy of the draft bill circulating online, policymakers in the U.S. House of Representatives are looking to step up their scrutiny over big tech firms that are interested in cryptocurrencies. Under the section of “Prohibition related to cryptocurrencies,” the draft bill, called “Keep Big Tech Out Of Finance Act,” states: “A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System.”
The bill specifically defines a digital asset as “an asset that is issued and transferred using distributed ledger or blockchain technology, including, so-called ‘virtual currencies,’ ‘coins,’ and ‘tokens.’” It further clarifies any large tech firm with over $25 billion in global annual revenue could fall into this category and any violation of the proposed regulation should be subject to a fine of “not more than $1 million per each day of such violation.”
While the bill is still in a discussion draft form and not yet formally submitted, the news comes just weeks after Facebook announced a plan to issue the Libra cryptocurrency on a blockchain. The firm booked $55 billion in revenue for 2018. Worldwide regulators have since then voiced concerns on how Facebook’s plan can remain compliant with financial regulations across the globe.
Last week, the U.S. president Donald Trump made his first comments on cryptocurrencies via a series of tweets, in which he criticized Facebook’s Libra project had “little standing or dependability.”