Two bills aimed at providing clarity and certainty for the cryptocurrency industry passed the House of Representatives Financial Services Committee on Wednesday despite concerns from some lawmakers about the CFTC's role and its impact on investor protection.
Both the Financial Innovation and Technology Act for the 21st Century and the Blockchain Regulatory Clarity Act have been approved by the majority of committee members and will now be moved to the entire House of Representatives for voting.
The Financial Innovation and Technology for the 21st Century Act will make a clear distinction between securities and non-secure digital assets and give the CFTC greater powers to oversee the latter. The bill also aims to encourage cooperation and coordination among federal regulators, state officials and industry representatives.
The Blockchain Regulatory Clarity Act will provide a safe haven for blockchain service providers such as miners, validators and node operators. The bill would exempt these providers from government money transmitter licensing requirements, which are often costly and burdensome.
However, some Democrats have argued that giving more powers to the CFTC, which is more tolerant of crypto companies than the SEC, would weaken consumer protections and open the door to more fraud.
They also questioned whether the bills would weaken existing securities laws that had protected US investors for decades. They urged greater caution and thought before passing such sweeping laws.
On the other hand, some Republicans have defended the bills as necessary steps to foster innovation and competitiveness in the crypto space. They pointed out that the CFTC has recently received more funding from the Agriculture Committee so that it can fulfill its mandate more effectively.
*Not investment advice.