The Biden administration has officially declared its opposition to Financial Innovation Transparency (FIT) Bill 21 in its current form, citing significant concerns about the lack of adequate protections for consumers and investors. Despite this opposition, the administration has expressed a willingness to work with Congress to achieve a more balanced and comprehensive regulatory framework for digital assets.
Biden will not veto FIT21
The White House expressed opposition to the passage of the Financial Innovation and Technology for the 21st Century Act by the United States House of Representatives, citing insufficient investor protections. However, President Joe Biden did not threaten to veto the bill.
In an administration policy statement released Wednesday, the administration highlighted concerns about the bill's potential effects on investors if it were to pass Congress.
The press release stated: “HR 4763, in its current form, does not have sufficient protections for consumers and investors who engage in certain digital asset transactions. The Administration looks forward to continuing to work with Congress on developing digital asset legislation that includes adequate safeguards for consumers and investors while creating the conditions necessary for innovation, and additional time will be required for such collaboration.
Hours after Securities and Exchange Commission (SEC) Chairman Gary Gensler issued a strong statement opposing the legislation, the White House also expressed concerns. Gensler argued that the bill could threaten the SEC's ability to effectively regulate traditional and crypto markets. He said the Financial Innovation and Technology for the 21st Century Act (FIT21) would change requirements for securities issuers through adherence to federal law and Supreme Court decisions.
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Supporters of the bill argue that current US laws pose a continued threat of civil litigation to crypto companies, thereby affecting their operations. Gensler countered this view by suggesting that these companies seek exemptions from the standard disclosure and compliance obligations imposed on securities issuers.