The U.S. is making strides toward regulatory clarity in the crypto industry. The FIT21 bill and ETF approvals for Bitcoin and Ethereum could change the market landscape.
What Is the FIT21 Bill?
The FIT21 bill, short for the Financial Innovation and Technology for the 21st Century Act, aims to clearly define which U.S. agency regulates specific aspects of the cryptocurrency industry. One of the biggest problems in the U.S. has been the constant back-and-forth between the SEC and the CFTC. The FIT21 bill addresses this by establishing a clear distinction between commodities and securities.
Under FIT21, digital assets like Bitcoin and Ethereum would be treated as commodities under the CFTC. Tokens that don’t pass the Howey test could also be regulated by the CFTC, leaving the SEC with fewer tokens to control.
Why ETF Approvals Matter
In 2024 and 2025, the SEC approved several spot ETFs tied to crypto assets, including Bitcoin and Ethereum. These ETFs allow people to invest in crypto without holding the tokens directly, facilitating access for institutional and retail investors. ETF approvals signify a major shift in the SEC's attitude, which had previously refused to approve any spot crypto ETFs.
Regulatory Clarity Spurs Institutional Adoption
Unclear regulations have been one of the biggest barriers for institutional players entering the crypto space. With ETF approvals and the FIT21 bill gaining traction, companies are now finding clearer pathways. Financial institutions are launching crypto custody services and trading desks, encouraged by clearer regulations.
While the FIT21 bill is not yet law, the shift in regulatory policy in the U.S. could signify a pivotal moment towards a more mature and stable crypto industry, offering new opportunities to developers and users.
