Zinger Key Points
- Comprehensive legislation like FIT21 and crypto-friendly regulatory appointments are seen as priorities for fostering sector growth.
- The reversal of restrictive SEC guidance emerges as a crucial step for creating a pro-crypto business environment.
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Following considerable financial support during the 2024 election, the digital asset industry is positioning itself for a significant transformation in how it is regulated.
What Happened: After years of dealing with unclear federal policies, and some hostile action by regulators, a change could be on the horizon under a new presidential administration, according to The Hill.
President-elect Donald Trump, who had earlier criticized digital currencies, shifted his stance during his campaign, to become the first presidential candidate to receive donations in digital assets.
This shift, coupled with bipartisan support within Congress, creates an opening for the passage of important legislation impacting the cryptocurrency sector.
According to Kristin Smith, head of the Blockchain Association, the combination of a crypto-friendly Congress and president makes it possible to finally get supportive regulatory policy implemented, including measures about stablecoins and market structures.
Smith also stressed the need for unity within the industry, in order to properly articulate its needs to Washington D.C.
The FIT21 Act is a key piece of legislation, intended to clarify the respective roles of the SEC and CFTC, to create needed regulatory boundaries.
The legislation was successful in the House last year, but failed in the Senate, therefore the crypto sector will aim to have it reintroduced.
Rep. French Hill (R-AR), incoming Chair of the House Financial Services Committee, has listed this type of regulatory policy as one of his top priorities.
The SEC’s approach under Gary Gensler, was perceived by many in the industry as being overly harsh, and focused on enforcement actions, rather than clear guidance.
Also Read: Bitcoin, Ethereum ETFs Break 4-Day Outflow Streak, Net $592 Inflows On Thursday
Why It Matters: The new Trump administration is expected to be more accommodating.
Former SEC Commissioner Paul Atkins, known for his support of crypto, has already been nominated to replace Gensler.
Trump’s announcement of a new “crypto council” led by David Sacks is another indication of a more friendly administration toward crypto.
The future leadership of the CFTC remains in question, but with a number of well regarded crypto advocates being mentioned as candidates.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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