The U.S. House of Representatives has passed legislation that would create a new legal framework for cryptocurrencies, a step that could lead to eventual regulation of digital assets.
Lawmakers in the lower chamber of Congress voted in favour of the legislation despite strong objections from the U.S. Securities and Exchange Commission (SEC), which has warned that it could create new financial risks for Americans.
The legislation, called the “Financial Innovation and Technology for the 21st Century Act,” passed in a bipartisan 279-136 vote.
Lawmakers who support the legislation argue that it will provide regulatory clarity and help promote the cryptocurrency industry's growth in a responsible manner.
However, SEC Chair Gary Gensler warned in a written statement that the bill “would create new regulatory gaps and undermine decades of precedent regarding the oversight of investment contracts, putting investors and capital markets at immeasurable risk.”
The legislation was supported by the cryptocurrency industry, which has long criticized the SEC for impeding wider adoption of digital coins and tokens.
Gensler maintains that cryptocurrencies should be subject to the same laws as other assets such as stocks and bonds.
Among his many criticisms, Gensler said the legislation would also allow issuers of crypto investment contracts to certify themselves that their own products are digital commodities not subject to SEC oversight, leaving the agency just 60 days to challenge those claims.
The bill, having been approved in the House of Representatives, must still pass approval in the U.S. Senate, and be signed into law by U.S. President Joe Biden.
