US House Of Representatives Approves FIT21 Bill In Huge Win For Crypto

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As a researcher with extensive experience in the digital asset industry, I’m closely monitoring the developments surrounding the Financial Innovation and Technology for the 21st Century Act (FIT21) in the US. The recent House of Representatives approval of FIT21 is a significant milestone, signaling potential regulatory clarity for the crypto industry.

As a crypto investor, I’m excited to share that the US House of Representatives recently passed the Financial Innovation and Technology for the 21st Century Act with a significant majority, specifically 279-136 votes. This legislation gained strong momentum among Democratic representatives.

Should this legislation be enacted, it would bring about far-reaching consequences for the US regulatory framework concerning digital assets, signifying a landmark achievement for the crypto sector within the halls of Congress.

House Of Representatives Approves FIT21 

Among the 208 Republican House representatives, all but three of them endorsed the bill related to FIT21. On the other side, there were 71 Democratic House members who also gave their approval. This indicates a bipartisan effort in favor of FIT21, reflecting evolving perspectives towards cryptocurrency among Capitol Hill politicians. Last week, both the House and Senate passed legislation that eased crypto custody regulations for US banks, overturning previous SEC guidelines. Notable supporters of this bill include Senate Majority Leader Chuck Schumer (D-NY).

As a researcher studying the latest developments in cryptocurrency legislation, I’m excited to share that the FIT21 bill, which marks the first significant crypto-related bill to pass through Congress, is now making its way to the US Senate. However, the outcome in the Senate remains uncertain since there’s no counterpart bill and support among senators is yet to be determined. Furthermore, crucial committee work on cryptocurrency regulations has not been completed, leaving the US significantly behind other countries in this area.

A Comprehensive Framework 

The legislation sets up a detailed federal system for overseeing digital assets and designates the roles of the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC). This, among other measures, empowers asset issuers to classify their offerings as commodities through self-certification.

As a researcher studying this legislation, I can explain that the bill limits the Securities and Exchange Commission’s (SEC) regulatory scope, transferring the authority to regulate digital asset commodities solely to the Commodity Futures Trading Commission (CFTC). The bill sets forth guidelines for determining an asset’s status based on factors such as a project’s level of decentralization, token supply, and ownership, as well as the blockchain’s resistance to control by a single entity. One of the bill’s co-sponsors, Representative Patrick McHenry from the House Financial Services Committee (HSFC), mentioned during a statement that: [Representative McHenry’s name] expressed, [in his capacity as HSFC Chairman].

As a crypto investor, I’m deeply concerned about the ongoing regulatory battle between the SEC and the CFTC over cryptocurrencies. The current situation is frustrating and unclear for all parties involved. Both agencies are trying to assert control over the same asset class, resulting in conflicting and contradictory enforcement actions that leave consumers and innovators in limbo. However, I’m optimistic about the potential solution that FIT21 brings to the table. FIT21 aims to streamline the regulatory landscape for digital assets by working closely with these agencies to create a more cohesive and effective approach to regulation. By doing so, it has the power to put an end to this regulatory food fight and provide clarity and certainty for all stakeholders in the crypto ecosystem.

President Biden, Gensler Skewer Bill 

Gary Gensler, the Chairman of the Securities and Exchange Commission (SEC), expressed his strong objection to the bill in clear terms. He argued that passing this legislation would alter the legal definition of investment contracts, thereby potentially excluding numerous tokens from being classified as securities. The SEC has previously pointed out that several tokens bear similarities to securities due to investors providing funds with the expectation of earning profits derived from others’ efforts.

“According to the legislation, it’s been judicially established—despite some resistance from crypto traders—that numerous cryptocurrencies fall under the classification of securities according to current legal frameworks.”

As an analyst, I’ve been following the ongoing debate surrounding the Financial Institutions Tax and Transparency (FIT21) bill, which aims to ease regulations on crypto custody for banks. President Biden has previously expressed his opposition to this legislation and threatened to veto it if it reached his desk. However, despite passing both the House and the Senate, the bill hasn’t been signed into law yet.

“This bill still provides major exemptions from critical securities laws.”

Brad Sherman (D-CA) expressed his concern, stating that altering the definition of a security could pose a significant threat to the “hundreds of trillion dollars’ worth of markets” that underpin our economy. He further mentioned that crypto companies are hesitant to register and the proposed bill would offer them the chance to function without regulatory supervision.

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2024-05-23 12:04