What headwinds does crypto legislation face in 2024?
Legislative outlook:
Cryptocurrency legislation faces some major headwinds in 2024 including an upcoming election season, potential opposition from Securities and Exchange Commission Chair Gary Gensler, and pushback from some lawmakers who are concerned that some of the bills don't go far enough to regulate the sector.
Crypto had a wild year from the criminal trial of former FTX CEO Sam Bankman-Fried and charges against multiple exchanges to some wins in the court for the industry, the downfall of former Binance CEO Changpeng Zhao and excitement for a spot bitcoin exchange-traded fund. Going into 2024, lawmakers likely have all that in mind as they work on legislation to reign in the industry.
The focus has been largely on two Republican-led bills over the past year. One bill wants to regulate stablecoins on the federal level while the other takes a comprehensive approach to crypto's market structure. Both bills passed out of the House Financial Services committee led by Chair Patrick T. McHenry, R-N.C., in July, but would need to be brought to the Senate Banking Committee, which could prove to be a challenge next year.
"Banking has been a tough nut to crack," said Sen. Cynthia Lummis, R-Wyo., a member of the Senate Banking Committee, in November during a panel at the Blockchain Association Policy Summit. "It is a committee that advances very little legislation and has been reticent in the area of financial assets that are digitally based."
Chair McHenry, who is viewed as instrumental in pushing the stablecoin and market bill forward, recently announced he planned to retire at the end of his current term in early 2025, which could have an effect on the bills' passage.
