US House Bucks SEC Warnings, Passes Pro-Crypto Legislation FIT21 with Strong Support

CFTC FIT21
Ad Disclosure
Ad Disclosure

We believe in full transparency with our readers. Some of our content includes affiliate links, and we may earn a commission through these partnerships. However, this potential compensation never influences our analysis, opinions, or reviews. Our editorial content is created independently of our marketing partnerships, and our ratings are based solely on our established evaluation criteria. Read More
Last updated:
Ad Disclosure
Ad Disclosure

We believe in full transparency with our readers. Some of our content includes affiliate links, and we may earn a commission through these partnerships. However, this potential compensation never influences our analysis, opinions, or reviews. Our editorial content is created independently of our marketing partnerships, and our ratings are based solely on our established evaluation criteria. Read More
Crypto Reporter
Crypto Reporter
Shalini Nagarajan
Author Categories
About Author

Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

Last updated:
Why Trust Cryptonews
Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews
Ad DisclosureWe believe in full transparency with our readers. Some of our content includes affiliate links, and we may earn a commission through these partnerships. Read more

The US House on Wednesday voted in favor of crypto-friendly legislation (FIT21) that would hand control of cryptocurrency oversight to a government agency seen as more favorable to the industry.

Its objective is to establish a fresh legal structure for digital currencies. This is despite an unconventional caution from the US securities regulator regarding the potential emergence of financial hazards.

In a bipartisan vote, the House approved the Republican-sponsored Financial Innovation and Technology for the 21st Century Act (FIT21). The final tally was 279-136, with 71 Democrats joining the 208 Republicans in favor of the legislation.

House approval is just the first hurdle for new laws in the US. The FIT21 Act, despite passing the House, still needs Senate approval and the President’s signature to become law. It is currently uncertain if the Senate will pass the bill too.

FIT21 Crypto Bill Expands Freedom for Industry, Shifts Power to CFTC

The legislation would grant expanded liberties to crypto operators in the US. It would also transfer greater regulatory oversight of digital assets to the Commodity Futures Trading Commission (CFTC).

Placing most digital assets under the jurisdiction of the CFTC would categorize them as commodities instead of securities. This would shift regulatory oversight away from the SEC. This move is significant, especially given the Biden administration’s crypto industry crackdown initiated under the SEC’s purview.

The passage of the legislation potentially puts President Joe Biden in a difficult position. He must decide whether to go against his own SEC chairman and refuse a veto. It comes as former President Donald Trump courts the industry in his 2024 presidential campaign.

After the vote, House Majority Whip Tom Emmer said that the passage of the Act would pave the way for flourishing American digital asset innovation.

“This globally competitive framework will give entrepreneurs the clarity and assurance they need to build here, in the United States, while ensuring the next iteration of the web emulates our values,” he said.

SEC, White House Align in Opposition to FIT21’s Approach

Before the vote on Wednesday, the White House issued a statement that said the FIT21 bill doesn’t do enough to safeguard consumers involved in certain cryptocurrency transactions. However, it refrained from completely vetoing the legislation.

Wednesday’s House vote also followed SEC Chair Gary Gensler voicing criticism against FIT21. Gensler argued that the bill would, in some aspects, “create new regulatory gaps and undermine decades of precedent regarding the oversight of investment contracts,” potentially endangering investors and capital markets.

The federal regulator argued that FIT21 would work against already established securities law. It would negate the long-accepted Howey Test while reneging current regulations on investment contracts, he said. This would allow crypto operators to “self-certify” their products.

“The crypto industry’s record of failures, frauds, and bankruptcies is not because we don’t have rules or because the rules are unclear. It’s because many players in the crypto industry don’t play by the rules,” Gensler continued.

More Articles

Blockchain News
What’s Happening in Crypto Today? Daily Crypto News Digest
Sead Fadilpašić
Sead Fadilpašić
2025-02-06 13:25:00
Price Analysis
President Trump’s Son Says It’s Time to Buy Bitcoin – Is BTC About to Go Parabolic?
Arslan Butt
Arslan Butt
2025-02-06 12:27:03
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors