Saylor Floats Framework for Crypto Industry Regulation and Growth

MicroStrategy founder Michael Saylor recently published a proposal for crypto regulation and growth. His ‘Digital Assets Framework’ consists of five major points detailing the steps needed to foster crypto growth and adoption in the United States.

As the first step, Saylor argues that a clear, universally understood taxonomy for digital assets is necessary for innovation and policy creation.

He defines a digital commodity as an asset without an issuer backed by digital power, such as Bitcoin, and a digital security as an asset backed by a security, such as equity or debt. A digital currency is an asset backed by fiat, while digital tokens are fungible assets with issuers offering digital utility.

Next comes legitimacy, which consists of adequately identifying the rights and responsibilities of crypto owners and companies. Crypto owners reserve the right to self-custody, trade, and transfer their assets and are obliged to comply with local laws.

On the other hand, companies like exchanges and issuers maintain the right to issue digital assets and enable asset custody, trade, and transfer between their clients, respectively. They are also obligated to ensure fairness and protect client assets.

The third step is practicality, which outlines steps to ensure compliance and empower innovation. For example, costs should be limited so that issuing an asset costs no more than 1% of assets under management (AUM).

“By establishing a clear taxonomy, a legitimate rights-based framework, and practical compliance obligations, the United States can lead the global digital economy. A capital markets renaissance fueled by digital assets will unlock trillions in wealth, empower millions of businesses, and solidify the US dollar as the foundation of the 21st-century digital financial system,” Saylor wrote.

US Market Opportunity

Saylor’s proposal also outlines how the U.S. can become a leader in the digital assets market and unlock trillions of dollars in value creation. He proposes rapid issuance so issuers can create assets in hours or days, cost reduction so it is cheaper, and expansion of access so that more businesses can access tokenized assets.

Further, Saylor argues that a strategic digital assets policy can strengthen the dollar, reduce the national debt, and position the U.S. as a global leader in the digital economy. This includes establishing a strategic Bitcoin reserve, encouraging digital capital growth, and installing USD as the global reserve digital currency.