The US House of Representatives passed a bill on Wednesday to establish a legal framework governing cryptocurrencies in the US. This act has gained attention as it was done against the warning raised by the US security regulator, the Securities and Exchange Commission (SEC).
The House has approved the bill. The bill will be passed to the Senate to decide its future. Moreover, US President Joe Biden has said that he will not veto the bill.
#WATCH: Chairman @PatrickMcHenry delivers remarks on the House floor in support of #FIT21:
“FIT21 will cement the United States’ global leadership in technological innovation, invention, and adoption.”
Read more 🔗https://t.co/tv0aFzS5aY
📺 Watch his remarks 👇 pic.twitter.com/hPldTaj7JY
— Financial Services GOP (@FinancialCmte) May 22, 2024
What is the US Crypto bill?
This bill, “The Financial Innovation and Technology for the 21st Century Act” (FIT21), classifies cryptocurrencies as commodities rather than securities, thus altering the regulatory landscape of the crypto industry.
It also grants primary regulatory responsibility to the Commodity Futures Trading Commission (CFTC), reducing the SEC’s oversight.
“Today, the House took a historic step by passing FIT21 with broad, bipartisan support,” said Chairman Patrick McHenry (NC-10). “FIT21 provides the regulatory clarity and robust consumer protections necessary for the digital asset ecosystem to thrive in the United States. The bill also ensures America leads the financial system of the future and remains a hub for technological innovation.”
“As FTX’s collapse showed, we need a functional regulatory framework in place to create consumer protections that currently do not exist, while ensuring America is a leader in the digital asset market,” said Rep. French Hill (AR-02). “This legislation passed in a bipartisan manner, signalling that consumer protection and American innovation are priorities for lawmakers on both sides of the aisle.”
US Congressman Brad Sherman criticised the bill and blamed the government for creating a new currency. They Rejected the bill claiming the worst criminals use it and promoting regular bonds to be listed on blockchain, thus un-regulating it.
JUST IN: 🇺🇸 Congressman Brad Sherman says passing crypto bill FIT21 is creating a competitor to the US Dollar “used by the worst criminals in the world.” pic.twitter.com/uFgveFMYEJ
— Watcher.Guru (@WatcherGuru) May 22, 2024
SEC’s criticism
SEC Governor Gary Gensler warned that the bill “would create new regulatory gaps and undermine decades of precedent regarding the oversight of investment contracts, putting investors and capital markets at immeasurable risk.”
Gensler demanded that cryptocurrency be subjected to the same laws as other assets citing several frauds, bankruptcies and failures.
Gensler also criticised the Bill for allowing issuers of crypto investment contracts to self-certify their products as digital commodities, leaving the SEC only 60 days to challenge these claims.
In Wednesday’s statement, he said under the bill investment contracts recorded on a blockchain would no longer be deemed securities, denying investors protection under securities laws.
Trump’s Crypto push
Earlier this week, Donald Trump’s presidential campaign announced it would begin accepting cryptocurrency donations to build a ‘crypto army’ leading up to Election Day.
The campaign was launched allowing federally allowed donors to donate using any Crypto asset.
The announcement highlights Trump’s message as a crypto-friendly candidate, appealing to young voters who are increasingly involved in digital assets. The campaign is accepting various popular cryptocurrencies, including Bitcoin, Ether, and US Dollar Coin, as well as lower-value coins like Shiba Inu Coin and Dogecoin.
