Leaked copy of US draft bill shows DeFi and DAOs under regulation

Earlier today, a leaked copy of a draft U.S. cryptocurrency bill began circulating on Twitter. A leaked copy of the 600-page bill highlights some key areas of focus for regulators, including decentralized finance (DeFi), stablecoins, decentralized autonomous organizations (DAOs) and crypto exchanges.

User protection appears to be a major concern of the regulator, with policies aimed at requiring any crypto platform or service provider to be legally registered in the US, whether it is a DAO or a DeFi protocol.

This could significantly reduce the chances of an anonymous crypto project making headway in the United States. Any crypto platform that is not registered in the US is subject to taxes. The definition of DeFi still seems to be vague.

The leaked draft bill also seeks to provide greater clarity on securities laws related to digital assets, something the crypto community and lawmakers have been insisting on. According to the Commodity Futures Trading Commission's definition of commodities, if there is any kind of debt, equity, profit income or dividends, then it is clearly not a digital asset commodity.

The new draft bill proposes to increase exchange compliance costs, which could lead to an increase in exchange fees. Any protocol or platform that trades even one digital asset would be classified as an exchange, meaning automated market makers would fall into the same category.

The bill further ensures that exchanges cannot liquidate users' funds in the event of bankruptcy. Exchanges must also post terms of service that consumers agree to before using their services.

The leaked draft bill proposes clear policies to bring the nascent cryptocurrency market under legal jurisdiction. Many experts believe that while the policies outlined appear to encourage strict regulation, it is important to note that they are only drafts.

Dogecoin co-founder Billy Markus also commented on the leaked bill, saying that the new policy will take tough measures against DeFi, DAO, and anonymous projects.