Resounding 279 to 136, the US House of Representatives passed the Financial Innovation and Technology for the 21st Century Act (FIT21). Considered as a big victory for the crypto sector, the measure seeks to provide a long-awaited US legal structure for digital assets.
FIT21: Bipartisan Support, But Hurdles Remain
An unusual source helped FIT21 flourish: former House Speaker Nancy Pelosi. Promoting the measure as a “first step” towards controlling the rapidly expanding crypto market, Pelosi broke with convention by supporting it For the sector, this bipartisan support—71 Democrats working with 208 Republicans—marks a historic event.
Champagne corks, meantime, are probably going to remain popped for now. In the Senate, where crypto policy is still unexplored ground, the measure confronts a much more difficult obstacle. Although the House’s recent change towards crypto-friendliness gives some hope, persuading the Senate and the Biden administration will prove difficult.
Regulators Wary, President Threatens Veto
Concerning FIT21, both the White House and the SEC have voiced worries. Under Chair Gary Gensler, the SEC contends that existing rules may be applied to cryptocurrencies and feels the present bill lacks enough consumer protection mechanisms. Echoing similar worries, the White House demanded a more all-encompassing strategy based on “existing authorities.” President Biden has even threatened to veto the measure as it is right now.
As of today, the market cap of cryptocurrencies stood at $2.5 trillion. Chart: TradingView.com
A Fight For Clarity: Crypto Vs. Regulation
The passing of FIT21 marks a turning point in the continuous narrative of US cryptocurrency control. The sector has been in a murky area for more than ten years, therefore undermining investor trust and innovation. FIT21 supporters think the measure will offer much-needed clarity so companies may run with more certainty.
Still, authorities stay wary. Their main focus is shielding clients from the natural hazards connected to cryptocurrency, including volatility and possible frauds. They also contend that stronger rules are required to stop other illegal activity including money laundering.
The Road Ahead: Compromise Or Gridlock?
The direction FIT21 is headed still is unknown. The Senate could drastically change the measure, maybe adding tougher consumer protection policies or even calling for its total cancellation. The ultimate form of crypto control in the US will be decided by negotiations among legislators, authorities, and the White House.
The struggle for a clear legislative road for cryptocurrencies is far from done. Both parties have strong opinions, hence the next months might see a lot of discussion and compromise—or maybe a standstill. The result of this struggle will have major ramifications for investors, companies, and the evolution of money itself given the possibility of crypto to change the financial scene.
Featured image from The Hill, chart from TradingView