The Congress Passed The Financial Innovation and Technology for the 21st Century (FIT21) Act passed by 279 to 136. The bill, seen as a major win for the cryptocurrency industry, aims to create a long-awaited regulatory framework for digital assets in the United States.
FIT21: Bipartisan support, but hurdles remain
FIT21 received a boost From an unexpected source – former House Speaker Nancy Pelosi. In a move that defies expectations, Pelosi supported the bill, calling it a “first step” towards regulating the booming cryptocurrency space. This bipartisan support, with 71 Democrats joining 208 Republicans, represents a historic moment for the industry.
However, the champagne corks will likely remain open for the time being. The bill faces a tougher challenge in the Senate, where cryptocurrency regulation remains uncharted territory. While the House of Representatives' recent shift toward cryptocurrency friendliness may offer some hope, convincing the Senate and the Biden administration would be the answer. An uphill battle.
Regulators are wary and the president threatens to use his veto
Both the Securities and Exchange Commission and the White House have expressed concerns about this FIT21. The SEC, led by Chairman Gary Gensler, believes the current bill lacks adequate consumer protection measures, and argues that existing regulations could be applied to cryptocurrencies. The White House echoed these concerns, calling for a more comprehensive approach and a framework built on “existing powers.” President Biden even threatened to veto the bill in its current form.
As of today, the market cap of cryptocurrencies stood at $2.5 trillion. Chart: TradingView.com
Battle for Clarity: Cryptocurrencies vs. Cryptocurrency Systems
The passage of FIT21 marks a turning point in the ongoing saga of cryptocurrency regulation in the United States. For more than a decade, the industry has operated in a gray area, stifling innovation and investor confidence. Supporters of FIT21 believe the bill will provide much-needed clarity, allowing businesses to operate with greater certainty.
However, organizers remain cautious. Their primary concern is to protect consumers from the inherent risks associated with it Digital currencies, such as volatility and potential fraud. They also argue that a stronger regulatory framework is necessary to prevent money laundering and other illicit activities.
The way forward: compromise or stalemate?
The future of FIT21 remains uncertain. The Senate could significantly change the bill, perhaps imposing stricter consumer protections or even repealing it entirely. Negotiations between lawmakers, regulators, and the White House will be crucial in determining the final form of cryptocurrency regulation in the United States.
The battle for a clear regulatory path for cryptocurrencies is far from over. With both sides holding strong views, the coming months may witness a period of intense discussions and compromises, or perhaps reach a stalemate. With cryptocurrencies having the potential to reshape the financial landscape, the outcome of this battle will have major implications for investors, companies, and the future of money itself.
Featured image from The Hill, chart from TradingView