US Congressional Committee Passes Crypto Regulatory Bill In Major Win for Industry

On Wednesday, July 26, a key US House Panel passed a legislation from crypto advocates for building clearer set of rules for the nascent crypto industry. The House Financial Services Committee approved the Republican-led bill in a 35-15 vote.

On July 26, most U.S. lawmakers supported and voted in favor of two acts: the Financial Innovation and Technology for the 21st Century Act and the Blockchain Regulatory Certainty Act. The bill would establish clear rules for crypto firms to register with the U.S. Securities and Exchange Commission (SEC) as well as the Commodity Futures Trading Commission.

The Republican bill has a way for companies to show the SEC that their projects are decentralized enough to be registered as digital commodities with the CFTC. Congressman French Hill, who is the vice chairman of the House Financial Services Committee, expressed his pride that the bill passed its first step and got bipartisan support from the committee.

Hill said: “We have crafted landmark legislation that establishes robust consumer protections and clear rules of the road for market participants while keeping innovation in the United States.”

Advancing through the first step is a victory for cryptocurrency supporters who argue that the current rules are unclear and hinder the US Securities and Exchange Commission. Next, the House Agriculture Committee, led by Pennsylvania Republican Glenn Thompson, will review its part of the bill, which includes $120 million in extra funding for the Commodity Futures Trading Commission.

This additional funding will grant new powers to oversee the asset class according to the legislation. Republicans had warned that without clear rules, the crypto companies and other innovation will head overseas.

However, there is still opposition to the effort, including from SEC Chair Gary Gensler. He believes that there is no need for new rules to determine when a token falls under the SEC's authority, as existing securities laws are already clear. According to Gensler, the problem lies with some crypto firms who choose not to abide by these existing laws.

Along with the SEC Chair, some democrats have also refused to support the crypto legislation. Democratic Representative Maxine Waters criticized the bill, stating that it pays too much attention to the demands of the crypto industry and disregards regulatory advice from the SEC.

As I have said before, we don’t need to invent new regulatory structures simply because crypto companies refuse to follow rules of the road. Our securities laws have protected investors and retirees for 90 years while supporting capital formation and facilitating innovation,” said Waters.