The Cryptocurrency Regulation Act passed in the House of Representatives goes to the Senate

On Wednesday evening, the US House of Representatives passed the Cryptocurrency Market Structure Act, which aims to regulate the entire industry.

The Financial Innovation and 21st Century Technologies Act (FIT21) would effectively classify cryptocurrency as a commodity rather than a security and therefore exempt from securities laws. It would also determine the oversight of cryptocurrencies, whether they should be regulated by the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).

The Republican-led bill – the first stand-alone bill of its size – passed with a 279-136 vote in the lower house, gaining the support of 71 Democrats, including former House Speaker Nancy Pelosi, D-Calif.

The Cryptocurrency Act was approved by the US House of Representatives despite criticism from the SEC chairman Gary Gensler, who publicly expressed his opposition Additionally.

Gensler he stated“FIT21 would create new regulatory gaps and undermine decades of precedent in the supervision of investment treaties, exposing investors and capital markets to immeasurable risks.” He reiterated his position on cryptocurrencies as securities, expressing concern that the bill would exclude investment contracts recorded on blockchain from the statutory definition of securities and thus from the protection of federal securities laws.

Yesterday, hours before the vote, the White House also expressed opposition to the bill, citing concerns about inadequate investor protection. President Biden issued the so-called statement claiming to be against the bill, but did not threaten to veto it.

What’s next?

The bill must now gain Senate approval, but that will be difficult because leading figures in the Democratic-controlled Senate have shown little interest in it.

The bill is very unlikely to become law in Congress, but it could shed light on how Democrats and Republicans view cryptocurrency regulation.

In an election year when cryptocurrencies have become a political issue – with presumptive Republican presidential nominee Donald Trump accepting cryptocurrency donations and Democrats taking a softer stance on them – the responses from both political parties are important.