The U.S. House of Representatives, in a landmark move, approved the first major cryptocurrency regulation bill, known as the Financial Innovation and Technology for the 21st Century Act (FIT21). The decision, which passed with a vote of 279-136, had substantial backing from House Democrats and now propels the issue to the Senate, where its outcome remains uncertain due to a current lack of equivalent legislation.

FIT21 is the first substantial crypto bill to be approved by a chamber of Congress, signifying a notable victory for the crypto industry, and striving to regulate digital asset markets. Despite this achievement, the U.S. continues to lag behind other countries in establishing comprehensive crypto regulations. The current victory underscores the need for comprehensive oversight in this rapidly-growing sector.

FIT21 aims to institute a regulatory regime for U.S. crypto markets. The bill seeks to implement consumer protections, position the Commodity Futures Trading Commission (CFTC) as the primary regulator of digital assets/non-securities spot markets, and clarify the classification of a crypto token as either a security or a commodity.

However, the bill has had its share of criticism. Rep. Maxine Waters (D-Calif.) argued that the proposed legislation may allow crypto enterprises that have previously skirted securities laws to avoid accountability. President Joe Biden expressed opposition to the bill, although he did not explicitly threaten to veto it.

Prior to the approval, various amendments to the FIT21 bill were debated in the House, with the majority subsequently adopted. One of the key alterations, a proposal to modify a crowdfunding exemption from $75 million to $5 million, was rejected.