According to Decrypt, Republican Senator Thom Tillis of North Carolina and Democratic Senator John Hickenlooper of Colorado have introduced a bill that they say will establish safeguards to prevent another FTX-type collapse. The bill is called the Proof of Other Fund Reserves (PROOF) Act, which aims to prevent the unethical mixing of customer funds and requires a neutral third-party auditing firm to submit a proof of reserves (PoR) report every month.
Under the bill, crypto exchanges must establish baseline account standards to secure customer funds. It will also require verification of cryptographic proof of reserves and proof of the company’s liability. Finally, the bill provides for a range of civil penalties, including fines payable in the event of a crime.
