For the first time in history, the entire U.S. House of Representatives will vote on crypto legislation by the end of May. The Financial Innovation and Technology for the 21st Century (FIT21) Act (H.R. 4763) provides the Commodity Futures Trading Commission (CFTC) with new jurisdiction over digital commodities and clarifies the Securities and Exchange Commission’s (SEC) jurisdiction over digital assets offered as part of an investment contract.
Additionally, the bill establishes a process to permit the secondary market trading of digital commodities if they were initially offered as part of an investment contract. Finally, H.R. 4763 imposes comprehensive customer disclosure, asset safeguarding and operational requirements on all entities required to be registered with the CFTC and/or the SEC.
IBAT has expressed deep concerns about the risks of potential disintermediation of community banks with certain digital assets. Establishing and clarifying regulatory authority could be a gateway to establishing more legitimacy around cryptocurrencies and Central Bank Digital Currency (CBDC), which IBAT strongly opposes.
The House vote will be a barometer of support for the digital assets industry amid aggressive cryptocurrency super PACs fundraising efforts. The Senate is not expected to consider similar legislation this year. IBAT will continue to coordinate advocacy efforts with ICBA and the Texas congressional delegation on federal digital asset legislative efforts.
