With the value of Bitcoin skyrocketing and Wall Street moving like a hawk, the US cryptocurrency industry is holding its breath as a crucial vote in Washington approaches next week. The Financial Innovation and Technology for the 21st Century Act, or Fit21, could reshape the regulatory landscape for digital assets, potentially welcoming the industry into the fold or curbing its recent growth spurt.
Fit21: lifeline or leash?
Fit21 suggests a major shift in how the US government operates Digital currencies. Currently, the regulatory landscape is fragmented, with the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) each having a say.
Fit21 will establish the Commodity Futures Trading Commission (CFTC) as the primary regulator for cryptocurrencies, giving the industry a clearer picture of the rules it must follow. The bill would also establish guardrails to protect consumers from risky behavior and establish protocols for how these assets are held and treated in bankruptcy proceedings.
The Bitcoin industry has thrown its weight behind Fit21, calling it “crucial” for The future of the US digital asset market. The lack of clear regulations has been a major sticking point for the industry, with some companies even threatening to abandon the US altogether.
The Crypto Innovation Council is concerned that the United States is lagging behind other countries in adopting Bitcoin innovations. In an open letter to lawmakers, she said:
“By passing this legislation, we can accelerate the growth of blockchain technology and digital assets, promote financial inclusion and protect national security.”
Wall Street is getting into the crypto battle
Adding another layer of intrigue to the upcoming vote is the latest entry by Wall Street giants into the cryptocurrency space. The approval of a wave of bitcoin exchange-traded funds (ETFs) in January has opened the door for Wall Street to get a piece of the cryptocurrency pie.
These ETFs allow traditional investors to invest in Bitcoin without having to purchase and hold the cryptocurrency themselves. The prospect of exorbitant fees associated with incubating these ETFs has some industry observers concerned that Wall Street's involvement could stifle innovation.
Will Bitcoin find a home in the US?
With the Bitcoin price With the rise and mounting pressure from both the digital asset industry and Wall Street, the upcoming Fit21 vote is a watershed moment for cryptocurrencies in the US. If passed, the bill could mark the beginning of a new era of regulatory clarity and enhanced industry growth.
However, if the bill is rejected, the future of cryptocurrencies in the United States remains uncertain, which could lead to a mass exodus of cryptocurrency companies and hinder innovation. With 10 days left until the vote, all eyes are on Washington as lawmakers decide whether to welcome cryptocurrencies with open arms or keep them at bay.
Featured image from Getty Images, chart from TradingView