U.S. lawmakers advanced the Financial Innovation and Technology for the 21st Century Act after a day-long markup session on Wednesday, moving the bill towards the House floor.
The bill, which came with certain changes from its June draft, focuses on the crypto market structure and seeks to establish a set of principles for crypto firms to ensure they are within the law and adhere to comprehensive disclosure requirements set forth in the legislation.
Specifically, the bill lays forward a framework for digital assets to qualify as commodities under the jurisdiction of the U.S. Commodities and Futures Trading Commission (CFTC) if they are able to show that the blockchain is sufficiently decentralized.
This is an incredible milestone for our industry. Thank you to Chairman@PatrickMcHenry, @RepFrenchHill, @WarrenDavidson, and @GOPMajorityWhip Tom Emmer for their leadership on this bill. We look forward to tomorrow's House Agriculture markup. https://t.co/V51ZwXEnIg
— Kristin Smith (@KMSmithDC) July 27, 2023
The bill was advanced by a vote of 35 to 15 after Democrats and Republicans debated its merits and pitfalls. Kristin Smith, CEO of the Blockchain Association, described the event as “an incredible milestone” for the crypto industry.
“This is a historic day for crypto policy,” tweeted Jake Chervinsky, chief policy officer at the Blockchain Association.
“This sends a strong bipartisan message in favor of reasonable regulation for digital assets,” he added, referring to the six Democrats who voted in favor.
Important action you can take to protect the value of your crypto in America:
Today, two House committees started voting to take an important step on legislation that will create regulatory clarity for crypto. They will continue tomorrow. The bill will evolve during the…
— Brian Armstrong 🛡️ (@brian_armstrong) July 27, 2023
However, for the bill to become law, it would require “some serious Democratic support,” noted Paradigm’s Policy Director Justin Slaughter in a series of tweets last month.
Unsurprisingly, some Democrats on the committee slammed specific provisions in the bill for being inadequate in providing appropriate consumer protections.
“We don’t need to invent new regulatory structures simply because crypto companies refuse to follow the rules of the road,” said Rep. Maxine Waters, the committee’s ranking Democrat.