The United States House of Representatives took an important step toward regulating the cryptocurrency market by passing the Financial Innovation and Technology for the 21st Century Act (FIT21). The bill, approved by a vote of 279 to 136, now heads to the Senate for further consideration.
Understanding the FIT21 bill
The FIT21 bill, created by the House Agriculture Committee and the House Financial Services Committee, aims to clarify the regulation of digital assets in the United States. One of the key elements of the bill is the establishment of the term “digital commodity” to define certain digital assets, thereby describing the SEC's regulatory scope.
The main objectives of FIT21 include:
- Clarifying the SEC's Regulatory Roles
- Improving consumer protection
- Creating a stable environment for digital asset innovation
This legislation aims to eliminate scams, regulate cryptocurrency exchanges, and protect consumers, thereby fostering a safer and more trustworthy crypto market. The bill received bipartisan support, indicating broad consensus on the need for clearer crypto regulation.
The Republicans simply banned me from speaking on the House floor for the rest of the day because I listed Trump's trials.
I didn't say he was guilty, I just claimed they existed – and for that I was silenced.
Apparently, Republicans have the right to say that Trump's trial is… https://t.co/ajpmtxAze1
– Rep. Jim McGovern (@RepMcGovern) May 22, 2024
Legislative journey and work of the Chamber
FIT21's journey through the House has not been without obstacles. The proceedings began with a delay due to a comment by Rep. Jim McGovern about the former president. Donald Trump, which led to a standoff that lasted more than an hour. Once debate resumed, the bill passed the committee stage with a close vote of 204-203 before entering final debate.
During the final debates, Congressman Patrick McHenry highlighted the importance of FIT21, saying the legislation “will solidify America's global leadership in technological innovation, invention and adoption.” The bill ultimately passed by a strong majority, with 71 Democrats joining Republicans in supporting it.
“This vote represents years of tireless effort by policymakers, their staff and the industry to protect consumers and keep the United States at the forefront of digital innovation,” said Sheila Warren, CEO of the Crypto Council for Innovation. She pointed to the bipartisan support as proof that innovation and consumer protection can coexist in the digital asset space.
What’s next for the FIT21 bill?
Despite the bill's passage in the House, its journey is far from over. The next step is consideration by the US Senate. The Biden administration has expressed objections to the bill, citing the lack of a comprehensive regulatory framework for digital assets. However, the administration also showed a willingness to work with lawmakers to create clear crypto legislation and indicated that it would not veto the bill.
The House also passed another bill explicitly banning the U.S. Federal Reserve from issuing a central bank digital currency. (CBDC)reflecting ongoing debates over the future of digital currencies in the US financial system.