FIT21 Bill Passes the House, to Redefine Crypto Regulation
A significant legislative step toward crypto clarity, the Financial Innovation and Technology for the 21st Century Act passed the House and faces an uncertain Senate future.
In a landmark bipartisan vote, the U.S. House of Representatives approved the Financial Innovation and Technology for the 21st Century Act (FIT21), marking a crucial advancement toward establishing a clear regulatory framework for cryptocurrencies. The bill, which garnered support from 71 Democrats and 208 Republicans, passed with a 279-136 vote.
FIT21, introduced to delineate the regulatory responsibilities of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), faces a challenging path in the Senate. With no companion bill currently in play, its success is not guaranteed, especially as it encounters resistance from prominent crypto critic, Senator Elizabeth Warren. However, it was only a week ago that the Senate voted to repeal SAB 121, an SEC rule restricting collaboration between banks and crypto firms.
This legislative effort arrives amid heightened discussions around digital assets’ governance, with many industry leaders advocating for a modernized approach that moves away from “regulation by enforcement.” Representatives John Rose and Wiley Nickel emphasized the bill’s potential to foster innovation and protect consumers without stifling technological advances.
The proposed law, celebrated by crypto executives like Coinbase CEO Brian Armstrong and Ripple’s Brad Garlinghouse, aims to clear the fog surrounding crypto regulations. Armstrong hailed the passage as a “total victory” for clear crypto rules, whereas Garlinghouse pointed out the political implications of SEC Chair Gary Gensler’s regulatory style, suggesting it turned into a liability for the Biden administration.
Despite the administration’s opposition to the bill, citing the need for more robust consumer and investor protections, President Joe Biden has not threatened a veto. This openness indicates potential for future amendments that could pave the way for a balanced regulatory environment.
As the bill progresses, it may undergo several reviews and adjustments before potentially receiving the majority Senate vote required for passage. If successful, and if President Biden signs it into law, FIT21 could significantly alter the landscape of cryptocurrency regulation in the U.S., setting a precedent for future legislative efforts in the digital asset space.
