In a notable stance against the U.S. House of Representatives, the Biden administration has voiced opposition to the passage of the Financial Innovation and Technology for the 21st Century Act (FIT21), a bill aimed at shaping the crypto market structure. Despite the opposition, President Joe Biden’s administration has stopped short of threatening a veto, offering a glimmer of hope for the crypto industry.
The White House stated administrative policy on Wednesday, highlighting apprehensions regarding the bill’s potential to leave investors vulnerable due to inadequate protections. The administration emphasized a desire to collaborate with Congress on future legislation to address the complexities of the crypto markets.
SEC Chair Gary Gensler‘s recent remarks align with the administration’s stance, expressing concerns that the bill could impede the regulator’s ability to effectively oversee both traditional and crypto markets. Gensler stressed the importance of upholding existing federal laws and Supreme Court precedents in regulating securities issuers.
FIT21 proposes rediscovering compliance standards for securities issuers in light of the evolving digital asset landscape. Advocates argue that current legislation does not provide sufficient clarity for crypto companies, while critics, including Gensler, caution against loosening disclosure and compliance requirements.
Central to FIT21 is the creation of a new definition specific to digital assets, distinguishing between securities and digital commodities and determining the regulatory authority between the SEC and the Commodity Futures Trading Commission.
The bill is set for consideration by the full House later on Wednesday, with a vote expected in the afternoon. The administration’s statement underscores the need for comprehensive legislation that balances consumer protection and innovation in digital assets.
As discussions continue, the White House anticipates further collaboration with Congress to develop legislation that fosters innovation while safeguarding the interests of consumers and investors.
