22 May, 2024

Industry-Backed Crypto Regulation Act Heads to Congress

Shawn Munir
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Shawn Munir
Shawn Munir Shawn Munir Expert Author
Shawn Munir is the CEO of Coinweb.com and spearheads all the collaborative partnerships for the platform. He bought his first Bitcoin in 2017 and never looked back. He is also an investor in 200+ Web3 startups and is considered an expert in the field. Before building Coinweb with his co-founders, he co-founded Presail, a management...
Yulia Zakharchuk
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Julia Zakharchuk
Yulia Zakharchuk Julia Zakharchuk Expert Author
Julia is a professional crypto and blockchain writer known for her insightful YouTube channel "MoneyFest." She showcases her dynamic presentation skills as a host and moderator at blockchain conferences. Julia drives also business development at ChainUp and advises UNITBOX, an innovative NFT renting protocol. With her exceptional expertise, Julia is a highly valued industry contributor...
crypto regulation
Key Takeaways
  • The Financial Innovation and Technology for the 21st Century Act, or ‘Fit21’, is headed for its first congressional vote this week.
  • This industry-backed crypto regulation act will make significant progress in establishing clear rules and guidelines for crypto in the United States.

Industry-Backed Crypto Regulation Act Heads to Congress

U.S. Congress
U.S. Congress | Source: aoc.gov

This week will see another crucial vote take place on the future of crypto regulation in the U.S.

The Financial Innovation and Technology for the 21st Century Act, or ‘Fit21’, is an industry-backed bill that promises to provide much-needed clarity on the U.S. regulation of crypto.

The most important element of the act is the establishment of the Commodities and Futures Trading Commission (CFTC) as the leading regulatory body for crypto.

This would leave the crypto-skeptical Securities and Exchange Commission (SEC) with a much smaller role.

The FIT21 Act also contains broad legislation on other critical crypto regulation issues, such as capital standards, bankruptcy protection, segregation of customer funds and risk disclosure requirements.

The Crypto Council for Innovation (CCI) started an open letter to U.S. lawmakers supporting the bill, which was signed by numerous major figures in the crypto industry.

Current U.S. crypto regulation is inconsistent and confusing, which has acted as a major drag on the industry.

Current U.S. Crypto Regulation Inconsistent and Confusing

The regulation of the crypto industry in the U.S. is notoriously unclear and underdeveloped.

Major crypto industry figures regularly complain that they cannot find clear guidelines to act by and that enforcement feels random and capricious.

It is not that U.S. regulation is openly hostile to crypto, but rather that it is considered lazy and anachronistic.

The U.S. falls far behind other advanced financial jurisdictions, such as the E.U., U.K., Japan and South Korea.

Crypto industry figures have long warned lawmakers that the lack of clear regulatory oversight will simply send consumers offshore, where they will have even less protection from bad actors.

“By passing this legislation, we can accelerate the growth of blockchain technology and digital assets, fostering financial inclusion and protecting national security. It is crucial for the U.S. to maintain its leadership in financial innovation.”

Open letter from the Crypto Council for Innovation to U.S. lawmakers.

Organized Industry Support Shows Growing Crypto Maturity

Crypto Council for Innovation
Crypto Council for Innovation | Source: Crypto Council for Innovation

Over 50 crypto companies and organizations signed the Crypto Council for Innovation’s open letter to U.S. lawmakers, including crypto exchange powerhouses Coinbase and Kraken.

Organizations like the CCI represent a growing professionalism and maturity in the crypto industry.

These organizations are taking part in the crafting and promotion of crypto regulation legislation that will help move the industry forward.

As crypto continues to take an ever-growing share of financial transactions, the pressure to professionalize and mature the industry will continue to grow.

Crypto industry figures will grow increasingly comfortable with using the levers of power to move the industry forward.