A Breakdown of the Proposed Market Structure Bill

The proposed crypto bill aims to integrate crypto regulation into the existing US financial regulatory landscape, allowing tokens and related intermediaries to be simultaneously regulated by the CFTC and SEC. In this framework, tokens would sometimes be regulated as securities and sometimes as commodities. For example, insider tokens would be treated as securities with a 12-month lockup period, and could be sold on SEC-registered platforms.

The bill also provides a clear securities law exemption for end user distributions. Potential downsides include fragmented markets, SEC authority over crypto projects, possible lack of liquidity for insiders, and a dual regulatory regime.