Regulation
Graham Steele, former Treasury official, criticizes the FIT 21 law
As the House of Representatives prepares for a crucial vote, former Treasury official Graham Steele criticizes the Financial Innovation and Technology for the 21st Century Act (FIT 21), designed to regulate the digital assets sector.
This petition regarding the FIT 21 Act uses a progressive framework, asserting that the bill fights against “Big Tech.”
FIT 21 actually creates a light regulatory framework for crypto, largely outside of securities laws. (It contains no ban on Big Tech.)
Quite sneaky. pic.twitter.com/jXJLmTr065
– Graham Steele (@steelewheelz) May 21, 2024
Steele, who is aiming for the post of chairman of the Federal Deposit Insurance Corporation (FDIC), questions the effectiveness of FIT 21 in addressing today’s financial technology challenges. Critics argue that the bill’s light-touch approach could neglect investor protections and market stability, particularly when it comes to the role of big tech.
Despite support from digital asset companies like Coinbase and Kraken, concerns remain about potential legal loopholes and impacts on shareholder rights. Democrats Maxine Waters and David Scott oppose FIT 21, citing risks to established securities laws and market stability.
Leaked internal email reveals concerns about safe harbor provisions that could enable fraud and market manipulation. Lawmakers plan to consult the SEC for further information.
The debate reflects broader discussions about the political dimensions of cryptocurrency regulation. Mike Novogratz, CEO of Galaxy Investment Partners, warns against the politicization of crypto regulations, calling for a bipartisan approach.
The fate of FIT 21 depends on these debates, highlighting the complex balance between promoting innovation and ensuring regulatory safeguards in the digital assets landscape.
Read also: House of Representatives passes US Blockchain Act of 2023