U.S. House Passes FIT21 Bill for Digital Asset Regulation
The U.S. House of Representatives has passed the 'Financial Innovation and Technology for the 21st Century Act' (FIT21), with a significant majority of 278 yeas to 136 nays. The bill, which aims to establish a regulatory framework for digital assets, has sparked debate and received broad political support, including from 70 Democrats typically opposed to cryptocurrencies. However, the Biden administration opposes the bill in its current form, expressing concerns about potential harm to retail investors and competition for the U.S. dollar.
FIT21 defines a decentralized blockchain as one where no single entity holds unilateral control, and no issuer or affiliate controls 20% or more of the digital asset or its voting rights. The crypto industry views the bill positively, as it could provide more regulatory clarity and shift oversight from the SEC to the CFTC, which focuses on institutional investors rather than retail protection. Critics, however, argue that looser regulation could harm retail investors or hinder competition for the U.S. dollar.
President Joe Biden's Financial Stability Oversight Council (FSOC) has opposed H.J. Res. 109, a bill aimed at loosening bank regulations on cryptocurrencies. The SEC faces criticism for suing exchanges offering unregistered securities without clear guidelines on which cryptocurrencies are securities. FIT21 aims to address these concerns by classifying cryptocurrencies as commodities or goods and shifting regulatory oversight to the CFTC.
FIT21, with its broad political support, may be the most significant digital assets legislation in congressional history. As the bill progresses, lawmakers will need to address the Biden administration's concerns and balance the interests of retail investors, institutional investors, and the crypto industry. The final form of the bill will shape the future of digital asset regulation in the United States.
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