U.S. Representative Don Beyer, a Democrat representing Virginia’s 8th District, has introduced a bill called the “Off-Chain Digital Commodity Transaction Reporting Act,” aiming to create centralized repositories for off-chain cryptocurrency transaction data.
The bill, dated September 27, encourages cryptocurrency trading platforms to report all transactions to a repository registered with the Commodity Futures Trading Commission (CFTC). Typically, off-chain transactions are not recorded on the blockchain, making them susceptible to hacking and data breaches based on their specific implementation.
Beyer emphasized the need for this legislation due to the increasing number of off-chain transactions that occur daily. These transactions are not publicly recorded on the blockchain, posing privacy and security concerns.
The bill seeks to address these issues by requiring trading platforms to report every transaction executed within 24 hours to a CFTC-registered trade repository. Beyer sees this legislation as a common-sense measure to enhance transparency and confidence in the digital asset market.
He hopes that the implementation of repositories where regulators can access off-chain transaction data would help prevent incidents similar to the collapse of FTX.
Beyer had previously introduced the Digital Asset Market Structure and Investor Protection Act in 2021, aimed at safeguarding consumers and promoting innovation in the cryptocurrency industry.