Just In: White House Rejects FIT 21, Calls for Fair Crypto Laws

The White House has opposed the Financial Innovation and Technology for the 21st Century Act (FIT 21) due to lack of proper investor protection. This move comes even after the bill holds the possibility of influencing new legislation in the cryptocurrency market.

The statement also points out the willingness of the administration to work with the Congress in order to establish a better legal framework for the digital assets.

White House Rejects FIT 21

The US administration has officially voiced its opposition to the FIT 21 bill, which seeks to reform the market rules for digital assets. The White House has noted that the current version of the bill is insufficient in terms of consumer and investor protection in digital asset transactions.

“H. R. 4763 in its current form is inadequate in terms of consumer and investor safeguards,” the administration pointed out. This position points to a more extensive legislative strategy where it would be possible to include all the existing financial authorities into the array of the balanced legislation.

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

Unlike previous occasions where the White House has threatened to veto other legislative initiatives, the administration has not ruled out further discussions with regard to FIT 21. This approach testifies to the continuous efforts to enhance the regulation of the digital assets, thus strengthening the position of the USA in the global financial space.

SEC Chair Gary Gensler Stance

Simultaneously, the Chair of the Securities and Exchange Commission, Gary Gensler, expressed equally intense criticism of the FIT 21 Act, noting that it will open new loopholes in the regulation of the cryptocurrency market and traditional financial markets. Gensler’s worries are especially on the possibility of creating a loophole for firms to escape a tough regulation from the SEC by simply declaring that they are decentralized.

This, he claims, could reverse the progress made in financial regulatory policies over the last few decades and make investors more vulnerable to risks.

Gensler’s statement also pointed out the possibility of using self-certification to bypass the securities laws and argued that bad players will be able to use it for fraudulent activities. This firm stand is indicative of the fact that the SEC continues to uphold high standards of investors’ protection in the domain of digital assets.

Concurrently,  Graham Steele, a former Treasury official, opposed the regulation calling it a light-touch regulatory framework for cryptocurrencies. 

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