The United States House of Representatives has approved a comprehensive bill to establish regulatory frameworks for digital asset markets, marking a huge win for the industry.
The Financial Innovation and Technology for the 21st Century Act (FIT21) secured a 279-136 vote, with both Democrats and Republicans supporting the measure, according to an official press release.
The FIT21 bill intends to establish a regulatory regime for US crypto markets. It aims to introduce consumer protections, designate the Commodity Futures Trading Commission (CFTC) as a key regulatory authority for digital assets and non-securities spot markets, and provide clearer definitions of what constitutes a security or a commodity in the crypto token realm.
The approval marks the first time that a major crypto bill has successfully cleared one of the chambers of Congress.
However, the future of the bill remains uncertain as it now advances to the US Senate, where no counterpart legislation currently exists.
FIT21 to Bridge Regulatory Gap in the US
The approval of FIT21 is a step towards bridging the regulatory gap that has placed the US behind other global jurisdictions in terms of establishing comprehensive crypto regulations.
“FIT21 provides the regulatory clarity and robust consumer protections necessary for the digital asset ecosystem to thrive in the United States,” Chairman Patrick McHenry said.
“The bill also ensures America leads the financial system of the future and remains a hub for technological innovation.”
FIT21 unlocks a conversation beyond innovation. It’s about national security, consumer protection & global competitiveness.
It’s about shaping what the future global digital economy looks like and how it functions.
Let's give Americans the clarity needed to seize this moment. pic.twitter.com/scdatvjyp5
— Tom Emmer (@GOPMajorityWhip) May 22, 2024
The final vote resulted in 71 Democrats and 208 Republicans voting in favor of the bill, while 3 Republicans and 133 Democrats opposed it.
FIT21 Bill to Establish Regulatory Regime for Crypto
President Joe Biden expressed his opposition to the legislation through a policy statement, although he did not indicate that he would veto the bill as he had previously done with regard to crypto accounting policy set by the Securities and Exchange Commission (SEC).
SEC Chair Gary Gensler also voiced strong opposition to the bill, arguing that it was unnecessary and posed a risk to existing securities regulations.
Opposing the bill, Representative Maxine Waters, the ranking Democrat on the House Financial Services Committee, argued that it would allow crypto businesses that have evaded securities laws to evade responsibility further.
“They have already made billions of dollars unlawfully issuing or facilitating the buying and selling of crypto securities,” she said.
“And Republicans are now proposing to reward these illegal activities by making these activities legal.”
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Before the final vote, the House engaged in discussions on several amendments proposed by representatives from both parties.
While a crowdfunding exemption amendment by Representative Greg Casar (D-Texas) was defeated, other amendments put forth by Representatives Brittany Pettersen (D-Co.), Ralph Norman (R-S.C.), and Scott Perry (R-Pa.) were adopted.
Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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