FIT21: When will U.S. crypto regulation pass the Senate?

In an interview with Bloomberg, Republican Congressman Patrick McHenry argues for a quick passage of the Financial Innovation and Technology for the 21st Century Act (FIT21) by the U.S. Senate. The bill was already approved by the House of Representatives on May 22 by 279 votes to 136 from both parties. Now it still needs to pass the Senate.

"This should be a wake-up call for the Senate," the chairman of the Financial Services Committee told Bloomberg on May 30. The regulations are considered a milestone for the crypto sector in the U.S. At the heart of the content is a division of responsibilities between the SEC and the CFTC. The CFTC, which tends to be more crypto-friendly, must regulate cryptocurrencies classified as digital commodities.

The FIT21 states, "A digital asset sold or transferred or intended to be sold or transferred under an investment contract is not and does not become a security by virtue of being sold or otherwise transferred under that contract." (PDF page 227, line 22 et seq.)

In his appeal to the Senate, McHenry also referred to the broad majority with which the bill passed. "The fact that we were able to pass this important bill with a two-thirds majority of the House of Representatives in these divided times is a statement in itself," he said.

The result was indeed surprising in its clarity. After all, American Democrats are considered chronically crypto-skeptical. President Biden had even announced that he would veto the bill. This he later retracted.

However, it is unclear when the bill will pass the Senate. There is no timetable for passage. However, McHenry is calling on House members to pass the bill before the U.S. presidential election on Nov. 5, 2024.