House Passes Landmark Crypto Regulation Bill FIT21
Washington, D.C. — In a significant move for the cryptocurrency industry, the U.S. House of Representatives passed the Financial Innovation and Technology for the 21st Century Act (FIT21) on Wednesday. The bill, aimed at regulating the crypto market, passed with a 279 to 136 vote, marking the first comprehensive crypto legislation approved by the full House.
Bipartisan Backing
The Republican-led bill garnered support from 71 Democrats, including former Speaker Nancy Pelosi of California. ”FIT21 is a first step to establish a regulatory framework for digital assets, and it must be improved by working with the Senate and the Administration,” Pelosi said. She emphasized the need for additional measures to protect consumers, investors, and taxpayers.
Bill Highlights
- CFTC Authority: FIT21 grants increased power and funding to the Commodity Futures Trading Commission (CFTC) to oversee crypto spot markets and digital commodities like bitcoin.
- Market Trading: The bill establishes a process for the secondary market trading of digital commodities initially offered as investment contracts.
- Stablecoins and AML: Provisions for stablecoins and anti-money laundering are also included.
Mixed Reactions
House Financial Services Committee Ranking Democrat Maxine Waters criticized the bill, calling it one of the worst she has seen. She argued that it would overstretch the CFTC’s resources, weakening its ability to enforce regulations. SEC Chair Gary Gensler echoed these concerns, suggesting the bill would create regulatory gaps and undermine investor protections.
Future Prospects
Despite its passage in the House, FIT21 faces a challenging path in the Senate, where top lawmakers have shown little interest or outright opposition. House Financial Services Chair Patrick McHenry, set to retire at the end of his term in January 2025, is determined to push for progress. ”My time as chair and my time in Congress is coming to an end, but the policy is not coming to an end,” McHenry said.
Changing Perceptions
Ron Hammond, director of government relations at the Blockchain Association, noted a shift in Congress’s view of the crypto industry. ”This view of the industry seems to not only be shifting opinions of the industry in Congress ahead of the FIT21 vote but potentially rolling back the regulatory barriers the SEC Chair has tried to build his legacy around,” Hammond stated.
Broader Context
The vote on FIT21 follows the Senate and House passing a measure to withdraw a Securities and Exchange staff accounting bulletin, which sets certain accounting standards for firms that custody crypto. Although the White House has opposed this measure and FIT21, it has expressed a willingness to work with Congress on a regulatory framework for digital assets.
Looking Ahead
With no companion bill in the Senate and significant opposition, FIT21’s future remains uncertain. However, its passage in the House sheds light on the evolving views of crypto regulation among U.S. lawmakers and sets the stage for potential legislative developments in the next Congress.
Featured image from: kitco.com