House Republicans Introduce Legislation for Crypto Market Structure
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Draft legislation revealed on Monday aims to create a regulatory framework for most digital assets. This proposed market structure bill comes after a previous attempt to pass similar legislation failed in the last Congress.
On Monday, four House Republicans presented a draft bill designed to establish a regulatory framework for digital assets in the United States.
If enacted, crypto assets certified as fully “decentralized” would be categorized as commodities and regulated by the Commodities Futures Trading Commission. In contrast, centralized assets would fall under the purview of the Securities and Exchange Commission.
“Overall, this bill reaffirms the CFTC as the leading regulator for crypto, while still granting the SEC authority until a network proves its decentralization,” noted Justin Slaughter, vice president of regulatory affairs at crypto venture capital firm Paradigm, on X.
Co-authors of the discussion draft include Representatives French Hill of Arkansas, G.T. Thompson of Pennsylvania, Bryan Steil of Wisconsin, and Dusty Johnson of South Dakota. Discussion drafts are intended for public comment and have yet to be formally introduced in the legislative process.
“By introducing essential safeguards and long-awaited regulatory clarity, this discussion draft promotes President Trump’s goal of positioning the U.S. as the ‘crypto capital of the world’ and strengthens America’s role in the global financial landscape,” Hill and Thompson stated.
According to Slaughter, the draft bill represents an “incremental, yet significant” revision of the FIT21, a market structure bill that successfully passed the House of Representatives last year.
The Financial Innovation and Technology for the 21st Century Act (FIT21) aimed to resolve the ongoing conflict over crypto regulation between the SEC and CFTC, as noted by one of its sponsors. Despite gaining substantial bipartisan support, it never reached a vote in the Democrat-controlled Senate.
This 212-page discussion draft also proposes establishing disclosure requirements for digital asset developers, guaranteeing the right to self-custody of crypto, implementing new consumer protections, and facilitating state-level rulemaking concerning digital assets.
A joint hearing by the House Agriculture and Financial Services committees is set to take place on Tuesday to discuss market structure legislation.
The bill joins two other pieces of cryptocurrency legislation currently under consideration in Congress: the Genius Act and the Stable Act, both focusing on the regulation of dollar-pegged stablecoins.
The Senate’s Genius Act encountered difficulties over the weekend when nine Democratic lawmakers withdrew their support, citing “numerous issues that must be addressed in the bill as it stands.”
Andrew Flanagan is a markets correspondent for DL News. Have a tip? Contact him at aflanagan@dlnews.com.
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