Chairman of the House Financial Services Committee Patrick McHenry said new legislation that would give the crypto industry greater clarity regarding regulatory oversight is expected to come up for a possible vote in the House by the end of May.
The proposed legislation – dubbed the Financial Innovation and Technology for the 21st Century Act (FIT21) – aims to provide clear regulatory frameworks for digital assets, addressing long-standing issues of market oversight and consumer protection.
Essential legislation
McHenry said on May 10 that the process of consideration will give the “a much-needed bill, the time it deserves.»
He added:
“ForFor too long, the U.S. digital asset ecosystem has been plagued by regulatory uncertainty that has stifled innovation and left consumers unprotected.
Sheila Warren, CEO of the Crypto Council explain that The exam will take place during the week of May 20.
The House Rules Commissionwhich is made up of nine Republicans and four Democrats, will likely consider the legislation under a “structured rule” that determines which amendments can be considered as well as the time allowed for debate on each side.
THE Committee will determine whether FIT21 is expected to go to a floor vote by the end of May. The bill must also be submitted to the Senate and the President.
SEC-CFTC distinction
FIT21 Gives CFTC Jurisdiction Over Crypto Products and Grants Jurisdiction to SEC on crypto offered in investment contracts.
The legislation explicitly aims to establish “bright lines between the SEC and the CFTC.” The SEC's ever-expanding enforcement efforts have become highly controversial in recent years, and as such, FIT21 could address one of crypto's most high-profile controversies.
This distinction is intended to help cryptocurrency developers find a way to raise funds and determine whether their activities are subject to CFTC or SEC oversight.
In addition to separating the roles of regulators, the bill also creates a process to allow secondary market trading of crypto products offered for the first time in an investment contract.
FIT21 also establishes rules for companies that must register with the SEC and CFTC, including requirements for customer disclosure, asset protection and operations.
House Committee on Agriculture Speaker Glenn Thompson, Whip Tom Emmer and Representatives French Hill, Dusty Johnson and Warren Davidson introduced the bill in July 2023.