U.S. Biden Administration Seeks Revisions to FIT 21 Bill for Better Consumer Protection, Says It Won’t Veto

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The Biden administration has officially stated its opposition to the Financial Innovation Transparency (FIT) 21 bill in its present form, citing significant concerns over the lack of adequate protections for consumers and investors. Despite this opposition, the administration has expressed a willingness to collaborate with Congress to achieve a more balanced and comprehensive regulatory framework for digital assets.

Biden Won’t Veto FIT21

The White House has expressed opposition to the passage of the Financial Innovation and Technology for the 21st Century Act by the U.S. House of Representatives, citing inadequate investor protections. However, President Joe Biden has not threatened to veto the bill.

NEW: The @WhiteHouse says it opposes passage of FIT 21 in its current form but also says it’s eager to work with Congress to “ensure a comprehensive and balanced regulatory framework for digital assets.” pic.twitter.com/CUP860dPsR

— Eleanor Terrett (@EleanorTerrett) May 22, 2024

In a statement of administrative policy released on Wednesday, the administration highlighted its concerns about the bill’s potential effects on investors if it were to be enacted by Congress.

The press release stated, “H.R. 4763 in its current form lacks sufficient protections for consumers and investors who engage in certain digital asset transactions. The Administration looks forward to continued collaboration with Congress on developing legislation for digital assets that includes adequate guardrails for consumers and investors while creating the conditions needed for innovation, and further time will be needed for such collaboration.”

Hours after Securities and Exchange Commission (SEC) Chair Gary Gensler issued a strong opposition statement against the legislation, the White House also voiced its concerns. Gensler argued that the bill could threaten the SEC’s ability to regulate both traditional and crypto markets effectively. He stated that the Financial Innovation and Technology for the 21st Century Act (FIT21) would change the requirements for securities issuers to adhere to federal law and Supreme Court rulings.

Also read: USA Elections: A Detailed Look at Biden’s Crypto Policies in 2024

Proponents of the bill argue that current U.S. laws pose a continuous threat of civil litigation for crypto companies, effectively affecting their operations. Gensler countered this viewpoint by suggesting that these companies are seeking exemptions from standard disclosure and compliance obligations required of securities issuers.