Republican Lawmakers Push Crypto Regulation With New House Subcommittee

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After taking control of the House of Representatives, Republicans are forming what they call a one-of-a-kind congressional caucus focused on digital assets.

The new subcommittee on digital assets, fintech and inclusion was announced Thursday by Congressman Patrick McHenry (R-NC), as other subcommittees of the House Financial Services Committee were presented.

McHenry said he thinks there is a big hole in the way we structure the committee because it spends more resources on topics related to the digital asset industry instead of the broader financial industry, Politico reported. Thursday.

The subcommittee will be chaired by Congressman French Hill (R-AR), who was also named vice-chairman of the committee of the whole. The new panel will provide rules of conduct for federal regulators of the digital asset ecosystem, as well as the development of policies that reach underserved communities through the promotion of financial innovation, according to a recent press release.

“At a time of major technological advances and changes in the financial sector, it is our duty to work in all directions and promote responsible innovation while encouraging FinTech innovation to flourish safely and effectively in the United States,” Hill wrote in a statement shared Thursday. .

The paneling comes as several crypto-related pieces of legislation move through the legislative process, such as the Lummis-Gillibrand Responsible Financial Innovation Act introduced in the Senate in June last year and more recently, the Stablecoin Act. TRUST, presented by the former Republican. Senator Patrick Toomey in the final weeks of his congressional career.

Hill is no stranger to crypto policy initiatives. In 2021, Hill co-sponsored a bill that required the Federal Reserve Board of Governors to study the potential impact of a US Central Bank (CBDC) digital currency, calling it important work when the report finally came through. been published.

Some Republican lawmakers have criticized how regulators have handled the digital asset industry, such as Congressman Tom Emmer (R-MN), who called out the Securities and Exchange Commission (SEC) under Chairman Gary Gensler. for a so-called regulation by enforcement approach.

Republicans should use the 118th Congress as an opportunity to establish regulatory clarity for the nascent asset class, a goal widely shared in the financial industry as well as in the halls of government.

McHenry had identified the digital asset ecosystem as an area the House Financial Services Committee needed to work on in December when he was chosen as the committee’s new chair, saying he would seek a comprehensive regulatory framework for the digital asset ecosystem.

McHenry was among many lawmakers who joined a chorus of critics following the rapid collapse of cryptocurrency exchange FTX in November, saying a strong regulatory framework would have helped avert the crisis that has rocked the crypto world. heart and had a negative impact on countless American investors.

For years, I have advocated for Congress to develop a clear regulatory framework for the digital asset ecosystem, including trading platforms, McHenry wrote in a press release. It is imperative that Congress establish a framework that ensures Americans have adequate protections while allowing innovation to thrive here in the United States.

He also discussed the possibility of speaking with companies such as Binance, focusing on the role it played in the collapse of FTX after CEO Changpeng Zhao telegraphed his company’s decision to sell its holdings in FTT and then dropped its takeover of the now bankrupt Sam Bankman-Frieds exchange.

I look forward to hearing more from FTX and Binance in the coming days about these events and the steps they will take to protect customers during the transition, McHenry said.

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