- The bill was intended to protect crypto users’ right to maintain custody of their digital assets.
- The committee acknowledged that the bill would address a key issue which was manifested following the FTX collapse.
“Not your keys, not your coins” is a fairly popular phrase thrown around in crypto circles, reminding users of the importance of self-custody. The slogan emphasizes that instead of entrusting their funds with a third-party custodian, consumers should preferably store them in a non-custodial wallet which would guarantee ownership.
In what could be a landmark development from this perspective, the U.S. House Financial Services Committee recently passed the “Keep Your Coins Act of 2023″ legislation. The crucial bill was intended to protect crypto users’ right to maintain custody of their digital assets in self-hosted wallets.
A step towards financial freedom
The bill was proposed by Republican representative Warren Davidson who took to Twitter to share the news about the legal clearance. Invoking the ideas of financial freedom, the lawmaker said,
“Those attacking self-custody oppose individual freedom. They want someone they control to control your assets.”
The legislation also sought to empower individuals to use their digital assets for their personal use, like purchasing goods and services, without unnecessary interference from federal agencies.
The Financial Services Committee acknowledged that the bill would address a key issue which was manifested following the collapse of FTX exchange last year. A large chunk of the users’ funds was stuck on the fallen exchange and they couldn’t access their own money.
Since then, self-custody has gained mainstream consciousness. The recent clampdowns on Binance and Coinbase have prompted users to withdraw their funds from the centralized entities.
More regulatory clarity
The green light given by the House Committee was the latest in a series of crypto-related bills sailing through the legislative waters of the United States over the past week. Along with the historic passage of the Financial Innovation and Technology for the 21st Century Act, the Clarity for Payments Stablecoin legislation was approved by legislators.
Better late than never, these laws constituted a positive departure from the United States’ inconsistent regulatory framework in regards to the cryptocurrency market. Over the years, the actions by the U.S. regulators have been termed as “regulation by enforcement”.
