The lack of clear regulatory guidelines has been a critical concern for investors and traders alike. Hence, the US House of Representatives is finally taking action.
Per Rep. Patrick McHenry, a joint meeting of the Financial Services and Agriculture panels will hold in May to work on new crypto legislation.
Teaming Up To Regulate Cryptocurrency
Representative Patrick McHenry, the House Financial Services Committee chair, has announced that the US House Financial Services Committee and Agriculture Committee will collaborate to create a bill regulating the cryptocurrency sector. Joint public hearings will hold in May, and the legislation should be finalized within the next two months.
McHenry expressed confidence that the bill could be signed by President Joe Biden within the next 12 months but acknowledged that it could be challenging to create new legislation. The proposed bill will handle the securities and commodities regimes and complex issues that cannot be quickly resolved on either side.
During the session, Sen. Cynthia Lummis (R-Wyo.) expressed her eagerness to collaborate with McHenry to advance the cause of cryptocurrency. She also remarked that the House of Representatives was more likely than the Senate to pass legislation sooner.
She suggested that if the House takes the lead on crypto, it would boost the legislation’s chances of success in the Senate. Lummis emphasized that the issue of crypto is nonpartisan and needs clarification before the 2024 election.
Last year, several bills related to cryptocurrency made progress on Capitol Hill. Still, comprehensive legislation has yet to pass in the US Congress.
However, Republicans on the House Financial Services Committee have introduced a discussion draft for stablecoin legislation that may serve as a starting point for negotiations with Democrats.
Congress Under Pressure To Regulate Crypto Industry
While bipartisan support for the bill is uncertain, Senator Cynthia Lummis plans to unveil an updated version of her bipartisan “Responsible Financial Innovation Act” in six-eight weeks. The new version will include stronger provisions on national security and cybercrime.
Lummis shared this information at the Consensus conference. A new bill has been introduced in both the Senate and the House of Representatives to investigate the use of cryptocurrencies for illegal activities.
This includes exploring how terrorists and other criminals may be using digital currencies. Recently, the Chair of the US Securities and Exchange Commission was questioned by a committee over whether Ether is a security.
However, Congress still needs to provide more guidance on this matter. Despite the ongoing deadlock between Republicans and Democrats, lawmakers are under growing pressure to regulate the crypto industry in light of the collapse of the FTX crypto exchange and the recent bank crisis.
According to McHenry, the role of crypto in the US banking crisis is like “Operation Choke Point 2.0.” He emphasized the need to address this issue and ensure safe and secure banking practices.
McHenry also urged Congress to legislate and provide clarity on the matter. Lummis echoed the sentiment, stating that several jurisdictions have already taken steps to regulate the space, and the US needs to catch up.
Regulators in Japan and the United Arab Emirates are moving towards regulation, while Hong Kong and the UK are reevaluating their approach to crypto and its regulation.
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