Eliminate Barriers to Innovation Act of 2021

IIB 117TH CONGRESS 1ST SESSION H. R. 1602 IN THE SENATE OF THE UNITED STATES APRIL 22, 2021 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To direct the Commodity Futures Trading Commission and the Securities and Exchange Commission to jointly estab- lish a digital asset working group, and for other pur- poses. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 2 HR 1602 RFS SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Eliminate Barriers to 2 Innovation Act of 2021’’. 3 SEC. 2. WORKING GROUP TO SUPPORT INNOVATION WITH 4 RESPECT TO DIGITAL ASSETS. 5 (a) ESTABLISHMENT.—Not later than 90 days after 6 the date of the enactment of this section, the Securities 7 and Exchange Commission and the Commodity Futures 8 Trading Commission shall jointly establish a working 9 group (to be known as the ‘‘SEC and CFTC Working 10 Group on Digital Assets’’) to carry out the report required 11 under subsection (c)(1). 12 (b) MEMBERSHIP.— 13 (1) IN GENERAL.—The Working Group shall be 14 composed of members appointed in accordance with 15 paragraph (2). 16 (2) APPOINTMENT OF MEMBERS.— 17 (A) REPRESENTATIVES OF COMMIS- 18 SIONS.—The Securities and Exchange Commis- 19 sion and the Commodity Futures Trading Com- 20 mission shall each appoint an equal number of 21 employees of each such Commission to serve as 22 members of the Working Group. 23 (B) REPRESENTATIVES OF NONGOVERN- 24 MENTAL STAKEHOLDERS.— 25 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 3 HR 1602 RFS (i) APPOINTMENT.—The Securities 1 and Exchange Commission and the Com- 2 modity Futures Trading Commission shall 3 each appoint an equal number of non- 4 governmental representatives to serve as 5 members of the Working Group, except 6 that such number of members may not be 7 greater than or equal to the number of 8 members appointed under subparagraph 9 (A). 10 (ii) REQUIRED MEMBERS.—The mem- 11 bers of the Working Group appointed 12 under clause (i) shall include at least one 13 representative from each of the following: 14 (I) Financial technology compa- 15 nies that provide products or services 16 involving digital assets. 17 (II) Financial firms under the ju- 18 risdiction of the Securities and Ex- 19 change Commission or the Commodity 20 Futures Trading Commission. 21 (III) Institutions or organizations 22 engaged in academic research or advo- 23 cacy relating to digital asset use. 24 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 4 HR 1602 RFS (IV) Small businesses engaged in 1 financial technology. 2 (V) Investor protection organiza- 3 tions. 4 (VI) Institutions and organiza- 5 tions that support investment in his- 6 torically-underserved businesses. 7 (C) NO COMPENSATION FOR MEMBERS OF 8 THE WORKING GROUP.— 9 (i) FEDERAL EMPLOYEE MEMBERS.— 10 All members of the Working Group ap- 11 pointed under subparagraph (A) shall 12 serve without compensation in addition to 13 that received for their services as officers 14 or employees of the United States. 15 (ii) NON-FEDERAL MEMBERS.—All 16 members of the Working Group appointed 17 under subparagraph (B) shall serve with- 18 out compensation. 19 (c) REPORT.— 20 (1) IN GENERAL.—Not later than 1 year after 21 the date of the enactment of this section, the Work- 22 ing Group shall submit to the Securities and Ex- 23 change Commission, the Commodity Futures Trad- 24 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 5 HR 1602 RFS ing Commission, and the relevant committees a re- 1 port that contains— 2 (A) an analysis of— 3 (i) the legal and regulatory framework 4 and related developments in the United 5 States relating to digital assets, includ- 6 ing— 7 (I) the impact that lack of clarity 8 in such framework has on primary 9 and secondary markets in digital as- 10 sets; and 11 (II) how the domestic legal and 12 regulatory regimes relating to digital 13 assets impact the competitive position 14 of the United States; and 15 (ii) developments in other countries 16 related to digital assets and identification 17 of how these developments impact the com- 18 petitive position of the United States; and 19 (B) recommendations— 20 (i) for the creation, maintenance, and 21 improvement of primary and secondary 22 markets in digital assets, including for im- 23 proving the fairness, orderliness, integrity, 24 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 6 HR 1602 RFS efficiency, transparency, availability, and 1 efficacy of such markets; 2 (ii) for standards concerning custody, 3 private key management, cybersecurity, 4 and business continuity relating to digital 5 asset intermediaries; and 6 (iii) for best practices to— 7 (I) reduce fraud and manipula- 8 tion of digital assets in cash, lever- 9 aged, and derivatives markets; 10 (II) improve investor protections 11 for participants in such markets; and 12 (III) assist in compliance with 13 anti-money laundering and countering 14 the financing of terrorism obligations 15 under the Bank Secrecy Act. 16 (2) REPORT LIMITED TO SEC AND CFTC AU- 17 THORITIES.—The analysis and recommendations 18 provided under subparagraphs (A) and (B) of para- 19 graph (1) may only relate to the laws, regulations, 20 and related matters that are under the primary ju- 21 risdiction of the Securities and Exchange Commis- 22 sion or the Commodity Futures Trading Commis- 23 sion. 24 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 7 HR 1602 RFS (d) NONAPPLICABILITY OF FACA.—The Federal Ad- 1 visory Committee Act (5 U.S.C. App.) shall not apply to 2 the Working Group. 3 (e) TERMINATION.— 4 (1) IN GENERAL.—The Working Group shall 5 terminate on the date that is 1 year after the date 6 of the enactment of this section, except that the 7 Chairman of the Securities and Exchange Commis- 8 sion and the Chairman of the Commodity Futures 9 Trading Commission may, jointly, extend the Work- 10 ing Group for a longer period, not to exceed 1 year. 11 (2) SECOND REPORT IN THE CASE OF EXTEN- 12 SION.—In the case of an extension of the Working 13 Group under paragraph (1), the Working Group 14 shall, not later than the last day of such extension, 15 submit to the Securities and Exchange Commission, 16 the Commodity Futures Trading Commission, and 17 the relevant committees a report that contains an 18 update to the analysis and recommendations re- 19 quired under subparagraphs (A) and (B) of sub- 20 section (c)(1). 21 (f) DEFINITIONS.—In this section: 22 (1) BANK SECRECY ACT.—The term ‘‘Bank Se- 23 crecy Act’’ means— 24 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 8 HR 1602 RFS (A) section 21 of the Federal Deposit In- 1 surance Act (12 U.S.C. 1829b); 2 (B) chapter 2 of title I of Public Law 91– 3 508 (12 U.S.C. 1951 et seq.); and 4 (C) subchapter II of chapter 53 of title 31, 5 United States Code. 6 (2) HISTORICALLY-UNDERSERVED BUSI- 7 NESSES.—The term ‘‘historically-underserved busi- 8 nesses’’ means women-owned businesses, minority- 9 owned businesses, and rural businesses. 10 (3) RELEVANT COMMITTEES.—The term ‘‘rel- 11 evant committees’’ means— 12 (A) the Committee on Financial Services 13 of the House of Representatives; 14 (B) the Committee on Banking, Housing, 15 and Urban Affairs of the Senate; 16 (C) the Committee on Agriculture of the 17 House of Representatives; and 18 (D) the Committee on Agriculture, Nutri- 19 tion, and Forestry of the Senate. 20 VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS 9 HR 1602 RFS (4) WORKING GROUP.—The term ‘‘Working 1 Group’’ means the working group established under 2 subsection (a). 3 Passed the House of Representatives April 20, 2021. Attest: CHERYL L. JOHNSON, Clerk. VerDate Sep 11 2014 20:52 Apr 23, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1602.RFS H1602 pamtmann on DSKBC07HB2PROD with BILLS