Legal Framework, Principles and Digital Asset Opportunities for the United States

1. Classification: Definition of Digital Asset Types

Developing a clear and consistent classification system is critical to promoting policy and innovation:

• Digital Commodity: Assets with no issuer, backed by digital power (e.g. Bitcoin).

• Digital Security: Assets issued by an organization, backed by securities (stocks, debt, derivatives).

• Digital Currency: Assets issued by an organization, backed by fiat money.

• Digital Token: A fungible, organized asset that provides digital utility.

• Digital NFT: Non-fungible asset, issued by an organization, providing digital utility.

• Digital ABT: Assets issued by an organization, backed by physical assets (such as gold, oil, agricultural commodities).

2. Legalization: Rights and Responsibilities

Creating a clear legal framework of rights and responsibilities is necessary for issuers, exchanges, and owners to operate in a transparent and trustworthy manner.

The Path to Legality: Establish a global, real-time, seamless process for issuing, trading, and owning digital assets by individuals, businesses, and machines.

Specific rights and responsibilities:

• Issuer:

  • Rights: Create and issue digital assets.

  • Responsibility: Ensure transparency and ethical conduct.

• Trading floor:

  • Rights: Custody, trading and transfer of assets between customers and other exchanges.

  • Responsibilities: Disclose property information, protect client assets, and avoid conflicts of interest.

• Owner:

  • Rights: To deposit, trade and transfer their assets.

  • Responsibility: Comply with local laws.

Core Principle: No one has the right to deceive, cheat or steal. All actions are subject to civil and criminal liability.

3. Practice: Reasonable Compliance to Promote Innovation

Digital asset regulation should prioritize efficiency and innovation, minimizing barriers and administrative procedures:

• Standardized disclosure: Define data structures for each type of digital asset to ensure transparency.

• Industry-led compliance: Enables exchanges to collect and publish asset data as a service to the industry and investors.

• Cost Limit:

  • Issuance Compliance: Issuance costs do not exceed 1% of total assets under management (AUM).

  • Maintenance Compliance: Maintenance costs do not exceed 0.1% per year.

• Simplify the issuance process: Eliminate complex regulations, empowering exchanges to provide integrated services to issuers, owners, and other exchanges.

Goal: Dramatic improvements in cost, speed, quality and access through free market competition and innovation .

4. Vision: Revitalizing Capital Markets

The United States has the opportunity to fuel a 21st-century capital markets revolution, creating trillions of dollars in new value:

• Rapid issuance: Allows issuers to create and bring digital assets to market in hours or days, rather than months or years.

• Cost Reduction: Lower issuance costs from $10-100 million to $10-100 thousand .

• Expanding access: Opening capital markets to 40 million businesses (up from the current 4,000 listed companies).

• Drive Mass Participation: Help small businesses, artists, celebrities, and mid-market businesses raise capital through digital assets.

Opportunity for investors: Opens up access to thousands of digital assets, including:

• Tokenized goods, real estate, art, businesses, teams, collectibles, intellectual property and brands .

• Financial instruments such as stocks, debt, derivatives, and currencies.

• Products, services and projects that bring value to customers, investors and fans.

5. Opportunity: Make the United States the Global Leader in Digital Assets

A strategic digital asset policy could strengthen the dollar, ease the burden of public debt, and help the United States lead the 21st century digital economy:

• USD Becomes Global Digital Reserve Currency: Expands the digital currency market from $25 billion to $10 trillion , creating massive demand for US government bonds.

• Digital Capital Growth: Expanding the global digital capital market from $2 trillion to $280 trillion , with the majority of this value belonging to US investors.

• Leadership in digital assets: Driving growth in digital assets (other than Bitcoin) from $1 trillion to $590 trillion , making the US dominate the industry.

• Strategic Bitcoin Reserve: Building a Bitcoin reserve could potentially create $16–81 trillion in value for the US treasury, opening up opportunities to reduce the national debt.

Conclusion: Seizing the Digital Asset Opportunity

By establishing a clear taxonomy, a rights-based legal framework, and practical compliance requirements, the United States can lead the global digital economy.

A revolution in capital markets based on digital assets will:

• Unlock trillions of dollars in value,

• Empowering millions of businesses,

• Strengthening the US dollar as the foundation for the 21st century digital financial system.

Source: Michael Saylor Digital Assets Framework