Crypto investors globally have been wrecked by various exchanges and custodians after regulators busted their illegal handling of funds. Many exchanges and custodians have either scammed their customers or they were hacked.
Retail Crypto investors could get full custody if this bill is passed
The case isn’t only limited to exchanges like FTX but also those irresponsible actors who misappropriate user funds in the name of custody. This needs to change.
How will this change?
Now, Senator Ted Budd has introduced the “Keep Your Coins Act” in the Senate that can usher a new era of independence for crypto investors. If passed, this legislation would grant direct custody of digital assets to crypto investors
It will effectively eliminate the need for intermediaries through self-hosted wallets. The bill’s primary objective is to empower individuals to maintain “independent control” over their assets and to safeguard against third-party breaches. The bill also intends to prohibit federal agencies from limiting the use of convertible virtual currency for personal transactions.
As consumers face new challenges and risks associated with the use of digital currencies, we should be empowering individuals to maintain control over their own digital assets. This approach will foster financial freedom and a more decentralized cryptocurrency ecosystem
Senator Ted Budd.
FTX is an example for such measures to be in place
This development comes hot on the heels of a high-profile case that shook the crypto world. Sam Bankman-Fried, the infamous FTX founder, was recently found guilty on seven counts. The was charged with wire fraud and money laundering.
His exchange’s collapse in November 2022 resulted because they mishandled over $8 billion in customer assets. It sparked a series of regulatory reevaluations of the crypto sector globally.
U.S. Attorney Damian Williams says that such frauds have been happening since a long time and the technology is not to be blamed here.
This kind of fraud, this kind of corruption is as old as time
Williams also issued a stark warning to potential wrongdoers. He asserted that Bankman-Fried’s conviction would serve as a deterrent. He promised that , “there will be enough handcuffs for all of them.”
Crypto friendly Senator Budd
Senator Budd has been advocating for crypto/investor friendly regulation since a long time. He was one of the notable figures behind the Financial Technology Protection Act introduced in April 2023. It aimed at countering terrorist use of crypto tokens.
Interestingly Representative Warren Davidson introduced a companion bill in the the House of Representatives with the same name. The House Financial Services Committee passed this bill in July 2023. However, it has not undergone further voting.