U.S. Congress may vote on new Crypto legislation by the end of May

Source: Blockchain Knights

Patrick McHenry, chairman of the House Financial Services Committee, said new legislation would provide more regulatory clarity to the crypto asset industry and could be voted on in the House by the end of May.

The proposed legislation, known as the Financial Innovation and Technology for the 21st Century (FIT21), aims to provide a clear regulatory framework for digital assets and address long-standing market oversight and consumer protection issues.

McHenry said on May 10 that the review process would give the “much-needed legislation” the time it deserves to be heard.

“For too long, the U.S. digital asset ecosystem has been plagued by regulatory uncertainty, which has stifled innovation and left consumers unprotected,” McHenry added.

Crypto Council CEO Sheila Warren further confirmed that the review would take place during the week of May 20.

The House Rules Committee, which consists of nine Republicans and four Democrats, will likely consider the legislation under "structured rules." Structural rules determine which amendments can be considered and how long the two sides can debate.

The House Financial Services Committee will decide by the end of May whether FIT21 should be submitted to the parliament for a vote, and the bill must also pass the Senate and the president.

FIT21 gives the U.S. Commodity Futures Trading Commission (CFTC) jurisdiction over Crypto commodities and specifies that the U.S. Securities and Exchange Commission (SEC) has jurisdiction over Crypto assets offered in investment contracts.

The legislation aims to establish "a clear line between the SEC and the CFTC."

The SEC's expanding enforcement efforts have been highly controversial in recent years, so FIT21 could resolve one of the most high-profile controversies surrounding Crypto assets.

The distinction is intended to help Crypto asset developers raise funds and clarify whether their activities are overseen by the CFTC or the SEC.

In addition to distinguishing the roles of the regulators, the bill also creates a process to allow secondary market trading of Crypto commodities to be offered for the first time in investment contracts.

FIT21 also sets rules for companies that must register with the SEC and CFTC, including requirements for customers, asset protection, and operations.

FIT21 was introduced in July 2023 by House Agriculture Committee Chairman Glenn Thompson, Whip Tom Emmer, and Reps. French Hill, Dusty Johnson, and Warren Davidson.