The House just gave the green light to the Financial Innovation and Technology for the 21st Century Act (FIT21), or H.R. 4763. But don’t start the party yet—this bill is headed to the Senate, where its future is as predictable as a meme coin’s value. You’d think the crypto market would rally on the news, but so far, the reaction has been: “meh.”
FIT21: House Approval, Senate Unknowns
The Republican-led FIT21 bill passed the House on May 22, with 71 Democrats and 208 Republicans saying “yes,” while 136 members showed it the door. This bill is supposed to clear up the roles of securities and commodities regulators in crypto, but it’s walking into a Senate storm without a companion bill. And guess who’s waiting? None other than Elizabeth Warren, crypto’s least favorite senator.
The Senate, which recently tried to nix a rule blocking banks and crypto firms from getting cozy, might take this up. Or not. They could sit on it for months. Even if they do, it’ll go through the usual bureaucratic grind: committee reviews, hearings, and markups. If it makes it through that mess, it needs a majority vote—51 senators. Then it’s back to the House and Senate for final approval before Biden gets his hands on it.
Senate Hurdles and Presidential Politics
Here’s where things get murky. The Senate could take forever to act, and even if they do, any changes will need to be reconciled with the House version. Then, it’s up to President Biden, who’s already said he’s not a fan. His administration has called FIT21 lacking in consumer protections but hasn’t outright threatened a veto.
Even if Biden does veto it, there’s a slim chance the House and Senate could override him with a two-thirds majority vote. But let’s be real, the path to FIT21 becoming law is a labyrinth.
Crypto Industry Reactions
SEC Chair Gary Gensler isn’t thrilled, claiming FIT21 creates “new regulatory gaps” and risks market stability. But Coinbase (NASDAQ: COIN) CEO Brian Armstrong is calling it a “total victory” and a win for “clear crypto rules.” Getting 71 Democrats on board is seen as a strong rebuke to the current SEC approach.
Not everyone’s breaking out the champagne. Crypto lawyer Gabriel Shapiro points out that FIT21 still gives the SEC a lot of power, especially over coins that aren’t fully decentralized. It’s a dual regulatory regime, splitting authority between the SEC and the Commodity Futures Trading Commission (CFTC), with the latter seen as the easier-going regulator.
For now, we wait. FIT21 could either set the stage for clearer crypto regulations or become another casualty of legislative gridlock.
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