The U.S. House of Representatives passed the FIT21 bill with a majority vote of 279 to 136, forwarding it to the Senate for further consideration.
This initial endorsement of the Financial Innovation and Technology for the 21st Century Act (FIT21) has the potential to greatly influence the cryptocurrency market, indicating positive sentiment throughout the industry. This legislation represents a notable stride toward establishing comprehensive regulations for digital assets in the United States, potentially defining the trajectory of cryptocurrency trading and investment in the future.
Understanding FIT21
The FIT21 legislation, developed jointly by the House Agriculture Committee and the House Financial Services Committee, seeks to provide clarity on how the SEC categorizes cryptocurrencies by introducing the term “digital commodity” for digital assets.
Its primary objectives include refining the SEC’s regulatory responsibilities, enhancing consumer protections, and fostering a stable environment for innovation in digital assets. The bill aims to eliminate fraudulent activities, regulate cryptocurrency exchanges, and safeguard consumers. Prior to the vote, the bill garnered bipartisan support.
Scott Mason, a senior policy advisor at Holland & Knight, shared with crypto.news that FIT21 “represents a significant opportunity to instill confidence in the cryptocurrency and blockchain industries regarding the U.S. market… The industry’s presence is enduring, and it’s crucial for the U.S. to lead rather than follow the lead of Europe (EUR) and other nations that are actively seeking investment from the industry.”
The Verdict
The House session began with a slow start after Rep. Jim McGovern made comments about former President Donald Trump, prompting Republicans to insist that McGovern’s “words be taken down.” This procedural move can be invoked during debates on the House floor, in the Committee of the Whole, or in the standing and select committees of the House.
The impasse over this matter lasted for more than an hour before the proceedings resumed. Following this, McGovern took to Twitter to announce that he had been prohibited from speaking on the House Floor.
Following these incidents, the bill successfully passed the committee stage with a vote of 204 to 203 before moving to final debates. During the final discussions, Congressman Patrick McHenry expressed his support for FIT21, asserting that the legislation “will cement the United States’ global leadership in technological innovation, invention, and adoption.”
The final vote resulted in 279 in favor and 136 against, with 71 Democrats supporting the bill.
This decision is the result of extensive efforts by policymakers, their teams, and industry stakeholders over several years to safeguard consumers and uphold the United States’ position as a leader in digital innovation. It demonstrates that innovation and consumer protection can work together in the digital asset realm. Seventy-one Democrats voted in favor of keeping tech a nonpartisan issue,” stated Sheila Warren, CEO of the Crypto Council for Innovation, in a note obtained by crypto.news.
Looking Ahead
Earlier on Wednesday, the White House expressed its objections to the bill, pointing to the insufficient regulatory framework for digital assets. Despite these concerns, the Biden administration indicated its readiness to work with lawmakers to develop clear cryptocurrency legislation and stated that the President will not veto the bill.
The journey of the FIT21 Act does not conclude with the House vote. If approved, it will move on to the U.S. Senate for further consideration. The House has approved legislation that prohibits the U.S. Federal Reserve from implementing a Central Bank Digital Currency (CBDC).
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