US House Introduces Crypto Bill in Light of XRP Ruling

Lawmakers in the United States have proposed a bill seeking to create clear rules for the crypto industry following the victory secured by Ripple and XRP in the SEC lawsuit.

A conglomerate of top committees in the United States House on Financial Services has introduced a crypto bill dubbed the Financial Innovation and Technology for the 21st Century Act.

Following the court ruling on July 13 that XRP is not a security, the House Committees on Financial Services and Agriculture have teamed up with top Republican legislators to launch a crypto-friendly bill.

The Ripple ruling highlighted the need for our legislation with @FinancialCmte to bring clarity to digital asset regulation. https://t.co/ZchqANyDvk

— House Committee on Agriculture (@HouseAgGOP) July 19, 2023

This landmark bill is conferred in a document titled Financial Innovation and Technology for the 21st Century Act. Introduced on July 20, the underlying goal is to establish clarity for cryptocurrencies amid the lack of clear regulations in the nascent industry.

The crypto bill, yet to be passed into law at press time, also seeks to protect crypto investors from issues such as the FTX meltdown, foster innovation, and position the United States as a leader in finance and technology.

Further, the collaborative bill establishes explicit principles to guarantee financial security as developers continue to innovate.

The main sponsors of this landmark bill include Glenn Thompson, Chairman of the House Committee on Agriculture; French Hill, Chairman of the Subcommittee on Digital Assets, Financial Technology, and Inclusion; and Dusty Johnson, Chairman of the Subcommittee on Commodity Markets, Digital Assets, and Rural Development.

Reactions to the Bill

According to Chairman Thompson, who championed the development, passing the bill into law will establish a much-needed regulatory framework that protects consumers and investors and fosters American leadership in digital assets.

Reacting to the initiative, Chairman Hill submitted that “this legislation would not only have prevented FTX from stealing billions of customer funds but also establish robust consumer protections and clear rules of the road for market participants.”

Recall that the once-thriving FTX exchange founded by Sam Bankman-Fried imploded in November 2022 due to customer funds commingling by the now-defunct trading platform.

I, alongside @CongressmanGT and @RepDustyJohnson, today introduced landmark legislation to establish a functional regulatory framework for #DigitalAssets that will protect consumers and keep innovation in the United States. Read more:@FinancialCmte @HouseAgGOP https://t.co/jWjWrFfdL8

— French Hill (@RepFrenchHill) July 20, 2023

In addition, Chairman Johnson conceded that the crypto market “is muddled with regulatory uncertainty, lack of authority, and a lacking framework for core operating principles.”

According to him, the recently released collaborative bill would give both the Commodity Futures Trading Commission (CFTC) and the US SEC a seat at the table.

To crown it all, the House Financial Services Committee Chairman, Patrick McHenry, lamented that the US is lagging in crypto adoption compared to other countries.

Countering Chair Gensler’s regulation by enforcement approach, the North Carolina Republican stated that blockchain innovators need regulatory clarity and certainty to enable crypto to achieve its full potential.

Impact of Ripple’s Win

Notably, this development comes shortly after Ripple scored a partial victory over the SEC in their prolonged legal tussle. As reported by The Crypto Basic, the court ruled that XRP is a non-security. 

Although she noted that institutional sales of XRP constitute securities offerings, the recent ruling serves as a big win for the crypto industry. Following the verdict, Ripple CEO Brad Garlinghouse emphasized that the victory is a wake-up call for Congress to act and enact clear regulations.