House Financial Services Committee Votes in Support of Cryptocurrency, Blockchain Bill

Author: Nikhilesh De, Elizabeth Napolitano, CoinDesk; Compiler: Songxue, Jinse Finance

The House Financial Services Committee has introduced a series of cryptocurrency bills following a landmark bill deliberation on Wednesday.

While the fallout from cryptocurrency exchange FTX loomed over lawmakers as they struggled to iron out the details of a bill aimed at providing a unified legal framework for cryptocurrencies and addressing blockchain-related issues, **a majority of lawmakers ultimately voted in favor of the Financial Innovation and Technology for the 21st Century Act and the Blockchain Regulatory Certainty Act, **Sending both bills to the full House of Representatives for a vote.

**During Wednesday’s deliberations, a large group of committee members – including Republicans and Democrats – declined to support a proposed market structure bill, criticizing a provision in the bill that would give the Commodity Futures Trading Commission (CFTC) More power. ** They also expressed concern about whether the bill would weaken consumer protections that are practiced in the United States. Decades-old securities laws that ultimately leave U.S. investors with less protection from fraud.

Nonetheless, the committee’s chairman, Rep. Patrick McHenry, R-N.C., praised the legislation in his opening remarks, noting that it was the committee’s first review of cryptocurrency-related legislation and confirming it Necessary to prevent the U.S. from “falling behind” other countries in cryptocurrency regulation. **

“Our comprehensive digital asset market structure legislation recognizes a key issue: digital assets that are not inherently securities may be offered as part of an investment contract, but this does not make them securities,” he said in comments.

** Critics of the bill say they are more concerned with the actual terms of the bill. **

“I’ve been on this committee for 20 years, and I can say unequivocally that this is the worst legislation ever proposed for deliberation in 20 years,” Rep. Stephen Lynch (D-Mass.) told the committee.

Democrats are unhappy with the fact that the proposed law would give the Commodity Futures Trading Commission more power to regulate the digital asset space without increasing the agency’s funding.

** The Commodity Futures Trading Commission (CFTC) has a reputation for being softer on cryptocurrency companies than the SEC, which Democrats say could lead to future fraud. ** FTX founder Sam Bankman-Fried and other crypto industry bigwigs have previously asked regulators to grant more powers to oversee the space.

However, Republicans who support the bill argue that the additional $120 million in funding recently approved by the Agriculture Committee will give the CFTC the resources to more thoroughly complete its work.

Republicans also urged fellow lawmakers not to shelve the bill, and **praise the potential clarity it could bring to the crypto industry. **

They say the cryptocurrency framework will temper what they say is a brutal crackdown on the digital asset industry by the SEC, incentivizing companies to stay in the U.S. rather than relocate to more cryptocurrency-friendly jurisdictions.

“If Congress does nothing, America will miss a huge opportunity and Americans will suffer because of it,” said Rep. Tom Emmer, also the majority whip.

The House Agriculture Committee will begin consideration of the Financial Innovation and Technology for the 21st Century Act on Thursday, while the Financial Services Committee will consider stablecoin legislation.

Senate concern

The House committee vote comes as the Senate added anti-money laundering provisions for the cryptocurrency industry to a must-pass defense bill. **

The NDAA now includes Senators Cynthia Loomis (R-Wyoming), Kirsten Gillibrand (D-N.Y.), Elizabeth Warren (D-Mass.) and Roger Marshall (D-Mass. Kansas Republican) an amendment that would require the Treasury Department, the National Conference of Bank Regulators, and other regulators to create a “risk-focused inspection and review process for financial institutions” to assess certain crypto-related issues. Currency Related Risks.

These include the adequacy of reporting obligations under current anti-money laundering schemes, and whether these agencies comply with the law.

The amendment also requires Treasury to create a report analyzing the role of “privacy-enhancing technologies or services related to cryptoassets” and provide legislative recommendations needed to address any issues.

Brett Quick, head of government affairs at the Crypto Innovation Council, noted that the industry group “appreciates the efforts of policymakers to address the important issues surrounding crypto and (Bank Secrecy Act)/AML compliance.”