Patrick McHenry, chairman of the House Financial Services Committee, said new legislation that will give the crypto industry more clarity on regulatory oversight will be voted on in late May.
The proposed legislation – called the Financial Innovation and Technology for the 21st Century (FIT21) Act – aims to provide clear regulatory frameworks for digital assets, addressing long-standing market surveillance and consumer protection issues.
Much needed legislation
McHenry said on May 10 that the consideration process is the “to give much-needed legislation the time it deserves.”
He added:
“ForFor far too long, the U.S. digital asset ecosystem has been plagued by regulatory uncertainty, which has stifled innovation and left consumers unprotected.”
Sheila Warren, CEO of the Crypto Council explained that The treatment will take place in the week of May 20.
The House Rules Committeemade up of nine Republicans and four Democrats, will likely consider the legislation under a “structured rule” that determines which amendments can be considered as well as the amount of time each side sets for debate.
The Commission will determine whether FIT21 should go to a vote at the end of May. The bill must also pass through the Senate and the President.
SEC-CFTC distinction
FIT21 gives the CFTC jurisdiction over crypto commodities and assigns SEC jurisdiction compared to crypto offered within investment contracts.
The legislation explicitly aims to “establish clear lines between the SEC and CFTC.” The SEC’s ever-growing enforcement efforts have become highly controversial in recent years, and as such, FIT21 could tackle one of crypto’s most high-profile controversies.
The distinction is intended to help crypto developers with a way to raise money and provide clarity on whether their activities are subject to CFTC or SEC oversight.
In addition to separating the roles of regulators, the bill also creates a process to enable secondary market trading of crypto commodities offered for the first time in an investment contract.
FIT21 also sets rules for companies that must register with the SEC and CFTC, including requirements around customer disclosure, asset protection and operations.
House Committee on Agriculture Chairman Glenn Thompson, Whip Tom Emmer and Representatives French Hill, Dusty Johnson and Warren Davidson introduced the bill in July 2023.