There have been at least 50 crypto-related bills since 2022 that have been introduced to Congress. However, this week is crucial as a vital congressional committee is set to vote on multiple bills that seek to create a regulatory framework for crypto assets.
Anticipated shifts in the U.S. crypto landscape are on the horizon. As the legislation comes up for debate and voting, it signifies the first time that crypto regulatory bills will undergo a congressional vote. The approaching process opens the path for a potential vote by the House of Representatives on certain bills. Kristin Smith, CEO of the Blockchain Association said,
“Obviously we’ve had some important decisions come from the courts in the past, but this is by far the most significant legislative moment that we’ve had.”
Among the increased number of bills that have been put forth, a few of these are considered to hold a substantial potential impact on the industry if they are successfully passed. The attention they are gaining from both lawmakers and the crypto industry underscores their importance and potential implications.
Crypto: Security or Commodity?
The House Financial Services Committee is gearing up to assess various legislative measures. One of the bills seeks to bring clarity to the classification of crypto as either securities or commodities. This issue is of significant importance since the crypto industry and regulators have been entangled in a dispute over how to categorize these digital assets. Ripple’s partial win against the Securities and Exchange Commission [SEC] may play a role in the decision.
This bill is part of the Financial Innovation and Technology for the 21st Century Act. It was introduced on July 20 and proposed by Republican members from the Agriculture and Financial Services Committees of the U.S. House. If enacted, this bill aims to grant the Commodity Futures Trading Commission [CFTC] authority over digital commodities. It also seeks to bring clarity to the jurisdiction of the SEC.
Furthermore, there is another bill that suggested setting up a regulatory framework to oversee stablecoins. The failure of Terra had a profound impact on the entire crypto market. Stablecoins were previously perceived as relatively safe. However, Terra’s downfall disrupted this perception and altered the narrative surrounding stablecoins. The Stablecoin TRUST Act and the Stablecoin Innovation and Protection Act are two of the proposed regulatory measures concerning stablecoins.
Significance of Democratic support
Despite their potential to significantly impact the crypto industry, these bills are likely to face hurdles in the Democratic-led Senate. The stance of key figures like Sherrod Brown, who heads the Senate Banking Committee, expressing uncertainty about the need for additional crypto regulation, adds to the probable challenges. Additionally, Representative Maxine Waters, the top Democrat on the Financial Services Committee, also remains skeptical about the bill’s fate.