House to Vote on Bipartisan FIT21 Act (HR 4763) Regulating Digital Assets

May 22, 2024, 08:40 AM

The U.S. House of Representatives is set to vote on the Financial Innovation and Technology for the 21st Century (FIT21) Act, a bipartisan bill aimed at providing regulatory clarity for the digital asset ecosystem. The bill, also known as HR 4763, seeks to regulate centralized finance (CeFi) while exempting decentralized finance (DeFi) from certain regulations. It proposes that the Commodity Futures Trading Commission (CFTC) regulate digital assets as commodities if they are functional and decentralized, while the Securities and Exchange Commission (SEC) would oversee digital assets considered securities. The bill has garnered significant support from both sides of the aisle, with House Democrats given the freedom to vote as they choose. However, SEC Chair Gary Gensler has criticized the bill, stating it would undermine decades of consumer protection laws. The Biden administration has also expressed concerns, citing insufficient protections for consumers and investors. Despite these objections, the bill is seen as a crucial step towards fostering innovation and protecting consumers in the U.S. digital asset market.