Rep. Patrick McHenry, the chair of the House Financial Services Committee, has announced that the committee will collaborate with the House Agriculture Committee to draft crypto legislation. The joint public hearings will begin in May, and the goal is to produce legislation that oversees the crypto industry within the next two months. Speaking at CoinDesk’s Consensus 2023 event, McHenry stated that the bill would address both securities and commodities regimes and deal with issues that are challenging to fix on either side. When asked if the bill could be signed by President Joe Biden within the next 12 months, McHenry replied affirmatively but noted that legislating something new into existence is always a challenge.
Sen. Cynthia Lummis, who was a panelist at the event, expressed enthusiasm for coordinating efforts with McHenry and stated that the House had a better chance than the Senate at passing legislation sooner. Lummis introduced the bipartisan Responsible Financial Innovation Act last year, which aimed to create a regulatory framework for the industry. She mentioned at the event that an improved version of the bill would be unveiled in six to eight weeks, with a stronger focus on national security and cybercrime.
Despite several bills advancing on Capitol Hill last year, the U.S. Congress has been unable to pass comprehensive legislation on crypto. However, Republicans on the House Financial Services Committee introduced a discussion draft this month in their second effort at stablecoin legislation, with the aim of finding bipartisan support. The bipartisan bill introduced in both the U.S. Senate and House of Representatives last week calls for the federal government to study crypto use cases for illegal activity, including how terrorists or other criminals might use cryptocurrencies.
Lawmakers are under increasing pressure to legislate the industry following the collapse of the FTX crypto exchange and the recent crypto banking collapse. McHenry referred to crypto’s recent role in the U.S. banking crisis as “Operation Choke Point 2.0” and stated that Congress must provide clarity and fix the problem to ensure that the industry’s banking relationships are secure.
In contrast, other jurisdictions such as the European Union have approved the Markets in Crypto Assets (MiCA) law, making it the first major jurisdiction in the world to introduce a comprehensive crypto law. Regulators in Japan and the United Arab Emirates have also moved towards regulating the space, while Hong Kong and the UK are revisiting their approach to crypto. Despite these efforts, Lummis believes that the US is falling way behind and needs to catch up.