Urgency in U.S. Congressional Committees for Cryptocurrency Regulation Bill

House Financial Services Committee chair, Patrick McHenry, has urged the Senate to pass a crucial bill aimed at clarifying cryptocurrency regulations before the upcoming U.S. presidential election in November.

On May 22, the U.S. House of Representatives approved the Financial Innovation and Technology for the 21st Century Act (FIT21) bill with a majority vote of 279 to 136, forwarding it to the Senate for further consideration.

McHenry emphasizes the pressing need for Senate action, stating that the strong support from the House should serve as a signal for prompt attention. He stresses the importance of Senate focus on policy enactment before the election date.

The legislation proposes that most cryptocurrencies be categorized as commodities, subject to regulation by the Commodity Futures Trading Commission (CFTC). This shift aligns with the industry's perception that the CFTC favors cryptocurrencies over the Securities and Exchange Commission (SEC), although the SEC would still maintain control over cryptocurrencies lacking sufficient decentralization.

McHenry, the retiring House Financial Services chairman, highlights the Senate's reaction of surprise to the bill's significant passage in the House. He underscores the achievement of obtaining a two-thirds majority vote for FIT21 in the divided political landscape.

The Senate has no set deadline for addressing FIT21. To pass, the bill necessitates a majority vote of at least 51 senators.

McHenry, in collaboration with Democrat Maxine Waters on crypto and stablecoin legislation, suggests that any new regulatory measures are likely to be included in a larger legislative package for Senate progression.

Critics contesting the crypto bill argue its excessive leniency towards the industry, while the Biden administration stresses the need for digital asset regulations to balance consumer protections and opportunities for crypto innovation.

McHenry rebuffs Senate Banking Chairman Sherrod Brown's proposal to link a stablecoin package with a bipartisan marijuana banking bill, a priority for Schumer. He asserts the lack of support for the cannabis banking legislation, citing previous opposition.

Republicans, led by McHenry, vow to exert pressure on Schumer and the Senate to prioritize the passage of crypto-related legislation.