North Carolina Firm Representative Patrick McHenry has proposed a beak that would better one of the laws governing the U.s. Securities and Exchange Commission (SEC) to provide a rubber harbor for certain token projects.

In a draft of the "Clarity for Digital Tokens Act of 2022," provided by the House Committee on Financial Services, McHenry suggested amending the Securities Act of 1933 to establish a safe harbor for token development teams. He proposed letting projects offer tokens without registering for up to iii years, during which time teams would be given the opportunity to create a fully decentralized network.

McHenry's bill seemingly builds on an initiative from SEC commissioner Hester Peirce, who has called for the creation of a safe harbor for projects that enhance funds to build decentralized networks later on first floating the concept in 2022. Peirce'south proposal likewise suggests granting network developers a three-year grace period to build a decentralized network without threats of legal action from the SEC.

"If adopted, the proposed safe harbor could exist the virtually groundbreaking development for the U.S. cryptocurrency market to date," Peirce said in February 2022. "Past putting development first and giving projects runway to build robust networks, the proposed condom harbor puts an important stake in the basis towards supporting American access and acceptance of digital asset markets."

The proposal comes the same day SEC chair Gary Gensler spoke to the committee regarding oversight of the government bureau. McHenry said Gensler had made "concerning and contradictory" statements on crypto assets concerning the SEC'south enforcement actions and regulatory purview.

"Nosotros need to nurture innovation and technology in this country, not send it overseas," said McHenry. "This bill [...] helps bring legal certainty to digital asset projects that we desperately need regulatory clarity to launch."

Kristin Smith, executive director of the Blockchain Association, commended McHenry'south efforts to create a safety harbor, emphasizing the collaboration between innovators and regulators. The Chamber of Digital Commerce, a crypto advocacy grouping in the United states, said the bill "has the potential to provide a much needed clear path forrard for those creating new innovations and solutions leveraging digital tokens."

Related: SEC chair doubles down, tells crypto firms 'come in and talk to the states'

McHenry — known by many in Congress as "Mr. Fintech" — has put forth several pieces of pro-crypto legislation, including suggesting that the Commodity Futures Trading Committee and SEC "plant a articulation working grouping on digital avails" to address regulatory clarity in the crypto space. He has also told his boyfriend lawmakers that attempts to stop Bitcoin (BTC) were futile every bit the cryptocurrency was an "unstoppable forcefulness."