A pivotal moment is approaching for the cryptocurrency industry, as the US House Financial Services Committee is gearing up to vote on a series of crypto bills that could establish a regulatory framework for the digital assets market.
The congressional meeting is taking place shortly after a critical ruling in the SEC vs. Ripple case. The court’s decision is viewed as a significant development in shaping US digital asset regulations. It emphasized the need for clear rules of the road for the digital asset ecosystem, making it even more crucial for Congress to act.
First-Ever Congressional Vote on Crypto Bills
According to a report by Reuters, the House Financial Services Committee is slated to evaluate multiple crypto bills, including one that aims to define whether a cryptocurrency is a security or a commodity. This is arguably the most important rule to establish clear guidelines on, given the SEC’s lack of clear provisions.
However, another bill on the table seeks to establish a regime for overseeing stablecoins like BUSD and Tether’s USDT. It aims to have the Federal Reserve set requirements for issuing stablecoins while preserving the role of state regulators.
While this is a significant step forward, the bills’ success may hinge on garnering Democratic support, which is seen as vital for their chances of becoming law.
Per Reuters, the Democratic-led Senate may pose obstacles, with the head of the Senate Banking Committee expressing uncertainty about the need for additional regulation.
Meanwhile, Representative Patrick McHenry, the Republican chair of the committee, has prioritized advancing a crypto market structure bill. This bill aims to expand the Commodity Futures Trading Commission’s oversight of the crypto industry while clarifying the jurisdiction of the Securities and Exchange Commission (SEC), addressing concerns about its perceived overreach.
The proposed market structure bill has gained support from many in the crypto industry. They believe that with bipartisan backing, it stands a better chance of success in the Senate.
Leading companies like Coinbase have long sought clarity on the regulatory status of digital assets. However, the SEC, under the leadership of Gary Gensler, has failed to provide clear rules and continues to maintain its dominance over the industry.
It regulates the trillion-dollar market by taking legal action against many participants and companies, arguing that most cryptocurrencies are securities and thus subject to investor protection rules.
Many firms disagree and have been urging Congress to clarify that cryptocurrencies are commodities, not securities.