A majority of members in the United States House of Representatives have voted in favor of a bill that aims to bring regulatory clarity to digital assets. The vote, which took place on May 22, saw House lawmakers approve the Financial Innovation and Technology for the 21st Century (FIT21) Act, also known as H.R.4763. The bill, if passed by the Senate and signed into law, will define the roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) in overseeing digital assets. A total of 71 Democrats joined forces with 208 Republicans to support the bill.
Representative Patrick McHenry expressed his concerns about the current regulatory framework and its impact on the innovation of digital assets. He stated that the SEC and CFTC are currently engaged in a power struggle over control of these asset classes. On the other hand, Representative Maxine Waters voiced her opposition to the FIT21 bill, claiming that it would create a regulatory gray area for cryptocurrencies and allow traditional finance firms to operate without SEC oversight. She referred to the bill as the most harmful proposal she has seen in a long time, expressing worries about its potential to cause a market crash and recession.
The House will continue its discussions and voting on H.R. 5403, also known as the Central Bank Digital Currency (CBDC) Anti-Surveillance State Act. This bill aims to prevent the Federal Reserve from issuing a digital dollar through intermediaries. Democratic Party leadership has stated that it does not support its members voting in favor of the anti-CBDC bill or the FIT21 bill. However, they will not enforce party discipline against these legislations.
As the United States enters an election year, crypto-related legislation and the SEC’s decision on a spot Ether exchange-traded fund (ETF) have become significant topics for voters. Both President Joe Biden and former President Donald Trump, who are expected to be the Democratic and Republican Party candidates in 2024, have agreed to participate in two debates on June 27 and September 10.
In a related note, the SEC is facing a tough battle against the legal firepower of the crypto industry, akin to the iconic clash between Godzilla and Kong.