Former U.S. House Speaker Nancy Pelosi is reportedly considering supporting the Republican-led Financial Innovation and Technology Act for the 21st Century (FIT21). Sources familiar with her thinking revealed that Pelosi, now out of Democratic Party leadership, might back the bill, which could be put to a House vote on May 22.
What Does FIT21 Propose?
The FIT21 bill aims to clarify the division of authority between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) over crypto assets. Additionally, it proposes amending the Howey test, a long-standing legal standard, to largely remove cryptocurrencies from SEC supervision.
The crypto industry has welcomed this bill, claiming it provides a more transparent regulatory framework. Mark Hays, a senior policy analyst at Americans for Financial Reform, commented that the bill offers a regulatory regime mostly dominated by the CFTC, aligning better with the global economy.
Who Opposes FIT21 and Why?
Pelosi’s potential support would put her at odds with Democrats like Maxine Waters and David Scott, who oppose the bill. However, leaked emails indicate they will not compel House Democrats to vote against it. Meanwhile, financial reform groups argue that the bill could unravel decades of financial regulations to benefit the crypto industry.
Pelosi’s favorable stance towards FIT21 reflects a growing acceptance among Democrats towards cryptocurrency. Some analysts suggest this shift aims to garner support from pro-crypto voters. On the other hand, financial reform advocates view this as a move influenced by super PACs, which have significantly bolstered the crypto industry’s political influence.
Key Takeaways for Stakeholders
– FIT21 could redefine regulatory authority over crypto assets, favoring CFTC oversight.
– If passed, the bill might exempt most cryptocurrencies from SEC regulations.
– Pelosi’s support could indicate a shift in the Democratic Party’s stance on cryptocurrency.
– Financial reform groups are concerned about the potential rollback of established regulations.
– Super PACs play a crucial role in shaping the political landscape around this issue.
The Outcome
With the upcoming vote on FIT21, all eyes are on Pelosi’s final decision. Her support could mark a significant shift in crypto regulation and influence the political dynamics surrounding cryptocurrency in the United States. Lawmakers and stakeholders alike are closely watching how this bill could reshape the regulatory landscape and its broader implications for the financial sector.