The Republican bill, dubbed FIT for the 21st Century, was drafted by two House committees and passed after strenuous preparations by members of both parties.
Tact was pervasive in the United States House of Representatives Agricultural Committee’s consideration of the Financial Innovation and Technology for the 21st Century Act on July 27. With many references to bipartisanship and self-congratulatory mentions of the members’ cooperation and hard work, the committee plowed through a series of amendments calmly and quickly.
The bill, co-written by Republican members of the Agriculture Committee and Financial Services Committee, seeks to create a comprehensive regulatory framework for digital assets. It was debated in the Financial Services Committee along with several other bills a day earlier.
Ranking member David Scott introduced the Democrats’ concerns, claiming that consumer protections need to be strengthened in the bill. It does not provide for third-party auditing, he said.
In addition, funding for the Commodity Futures Trading Commission (CFTC) was not increased in line with the new authorities the bill would give it, though it was later pointed out that the bill provides the CFTC with the minimum level of funding requested by Chair Rostin Behnam.
The bipartisanship took a while to show through, as Rep. Alma Adams called the bill “a fast track to investor confusion.” Her amendment to guarantee diversity on the boards of market participants was later voted down.
The provisional registration measures evoked comments from several legislators. Eventually, an amendment proposed by Rep. Yadira Caraveo to require provisionally registered parties to belong to a futures trade association was passed, with the purpose of providing some oversight of them while regulations were being worked out.
Shifting over to @HouseAgGOP as they markup the Financial Innovation and Technology for the 21st Century Act, Chair Thompson noted the following in his opening remarks:— DeFi Education Fund (@fund_defi) July 27, 2023
"This legislation marks a significant milestone in the House Committee on Agriculture's efforts to create a…
Market participants will also be required to have physical addresses under an amendment by Rep. Jasmine Crockett. Disclosure requirements were also strengthened.
The chair, Rep. Glenn Thompson, and the ranking member agreed to study decentralized finance further. The bill was successfully passed out of the committee.
The crypto community has vocally supported the bill. Crypto Council for Innovation CEO Sheila Warren praised the committee’s passage of the bill in a statement:
“It's a significant marker that shows keeping the status quo is not an option. There is too much at risk for consumers, US competitiveness and national security to take a back seat.”
Warren added, “The definition of ‘digital asset trading system’ should be narrowed and the new exclusion category to the definition of ‘digital asset’ included in Section 101 and the restrictions on mixed digital asset transactions further clarified.”