On Wednesday, the crypto industry celebrated a significant policy victory in the U.S. when the House of Representatives approved a comprehensive bill to establish regulations for digital asset markets. The bill, titled the Financial Innovation and Technology for the 21st Century Act (FIT21), passed with a 279-136 vote, with notable bipartisan support as Democrats crossed party lines to endorse it. This milestone marks the first time a major cryptocurrency bill has successfully cleared one chamber of Congress. The next challenge lies in the U.S. Senate, where the bill's future is uncertain due to the absence of a corresponding bill and unclear support from the necessary committees.

Despite this progress in the U.S., the regulatory landscape for cryptocurrencies remains underdeveloped globally, especially in regions like Africa. In Africa, the absence of official crypto regulations poses a significant challenge for the industry. This regulatory gap contrasts sharply with efforts in other jurisdictions that have started to establish frameworks for digital assets.

Rep. Josh Gottheimer's Statement

"We need rules of the road," stated Rep. Josh Gottheimer (D-N.J.), a Democrat who defied the opposition of both the White House and Rep. Maxine Waters (D-Calif.), the ranking Democrat on the House Financial Services Committee. Gottheimer praised the legislation as "well-reasoned, thoughtful, bipartisan" and urged collaboration to make it law.

Rep. Josh Gottheimer

The bill garnered support from 71 Democrats and 208 Republicans, while 3 Republicans and 133 Democrats opposed it. President Joe Biden has expressed opposition through a policy statement but has not indicated a veto threat, unlike his recent actions against a Securities and Exchange Commission (SEC) initiative on crypto accounting policy. SEC Chair Gary Gensler also criticized the bill, arguing it was unnecessary and posed risks to existing securities regulations.

Primarily driven by House Republicans, the legislation aims to regulate U.S. crypto markets by setting consumer protections, designating the Commodity Futures Trading Commission (CFTC) as the main regulator for digital assets and non-securities spot markets, and clarifying the classification of crypto tokens as securities or commodities.

Rep. Maxine Waters argued that the bill would enable crypto businesses, which have allegedly circumvented securities laws, to evade accountability. "They have already made billions of dollars unlawfully issuing or facilitating the buying and selling of crypto securities," Waters said. "And Republicans are now proposing to reward these illegal activities by making these activities legal."

The House also debated several amendments to the bill proposed by Reps. Greg Casar (D-Texas), Brittany Pettersen (D-Co.), Ralph Norman (R-S.C.), and Scott Perry (R-Pa.). While Casar's amendment to reduce a crowdfunding exemption from $75 million to $5 million was defeated, the other amendments were adopted.

As the U.S. makes strides towards crypto regulation, the lack of official regulations in Africa highlights the need for similar legislative efforts to ensure the safe and lawful growth of the crypto industry across all regions.