- Support from Nancy Pelosi might change the way that cryptocurrencies are regulated in the United States.
- Clearing up regulatory jurisdiction between the SEC and the CFTC is the goal of FIT21.
Reportedly, former US House of Representatives Speaker Nancy Pelosi is thinking about endorsing the Republican-led Financial Innovation and Technology for the 21st Century Act (FIT21).
The bill may shortly be put to a vote on the House floor; hence, its possible support is crucial. The position of Pelosi and other recent events in the cryptocurrency space draw attention to major changes in the political and legal environments.
Possible Backing of Nancy PelosiÂ
Now Speaker Emerita and out of the Democratic Party leadership, Pelosi might back the FIT21 plan, which the House may vote on as early as May 22. U.S. political magazine The American Prospect reports that sources familiar with Pelosi’s views have hinted at her potential support.
NEWS: Nancy Pelosi may support the Republican, industry-backed crypto bill hitting the House floor this week, in defiance of senior Democrats on the relevant committees.https://t.co/0kDamvku7v
— David Dayen (@ddayen) May 21, 2024
The FIT21 bill will clarify that the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have different regulatory authorities over cryptocurrency assets.
Should this bill be passed, it will also update the Howey test, a legal guideline for defining what is a security, therefore lessening the SEC’s control over the majority of cryptocurrency holdings.
Industry Reaction
Viewing FIT21 as a much-needed step to clear the currently murky regulatory framework for digital assets, the crypto industry has embraced it.
Senior policy analyst on fintech with Americans for Financial Reform Mark Hays pointed out that the bill provides the industry with a regulatory framework dominated by the CFTC, which is seen to be more accommodating of cryptocurrencies.
Pelosi would be going up against senior Democrats Maxine Waters and David Scott, who are against the idea, if she chose to back it. Leaked correspondence, however, implies they won’t actively urge House Democrats to oppose it.
With some analysts speculating that a potential SEC U-turn on spot Ether ETF approvals could be another attempt to win over pro-crypto voters, Pelosi’s stated backing fits with a larger trend of Democrats flocking to crypto.
Even with the rising support, financial reform organizations and anti-crypto Democrats contend that FIT21 will undo decades of financial laws in order to help the cryptocurrency sector. Hays remarked that this is not so much a drive to encourage cryptocurrency as it is to navigate super PAC commitments.
What Super PACs do?
In the approaching US elections, the cryptocurrency business has taken advantage of super PACs, which are political action organizations that may raise an endless amount of money.
This tactic is thought to have a big impact on politics; people like Senator Elizabeth Warren regard it as a danger as cryptocurrency grows more and more important in election dynamics.
Representative Wiley Nickel of North Carolina appealed to Congressmen on May 21 to back FIT21 in order to stop the SEC from “turning cryptocurrency regulation into a political football.”
SWIFT China and CBDC
On the other hand, Wen Yang, the President of SWIFT China, has offered insightful information about cross-border Central Bank Digital Currencies (CBDCs), echoing earlier coverage by ETHNews.
This viewpoint gives the continuing conversations on the future of digital assets and regulatory frameworks another level of complexity.