The cryptocurrency industry has witnessed a monumental development, following a vote to pass the Financial Innovation and Technology for the 21st Century Act (FIT21) Crypto bill. However, United States Congressman Brad Sherman has voiced concerns regarding the proposed bill, which aims to establish a comprehensive regulatory framework for these digital assets.

The pro-crypto bill was supported by a majority of members of the US House of Representatives. Specifically, about 279 members voted in favor of the approach, while 139 voted against it.

It is important to note that Democrats including Speaker of the House of Representatives Nancy Pelosi, accounted for 71 out of the 279 votes cast to pass the bill, while the remaining 208 votes accounted for Republicans. Additionally, a memo endorsing the Republican-devised proposal was signed by 8 House Democrats, demonstrating the broad bipartisan support for the measure.

FIT21 Crypto Bill Sees Criticism From Brad Sherman

On Wednesday, May 22, the House of Representatives passed the bill (FIT21), which marked a major step forward for the US in establishing clear regulations for the nation’s cryptocurrency sector.

Although the bill has received immense support thus far, it is yet to be signed into law. Should the bill be approved by the Senate and signed into law, it will define the authorities of the Commodity Futures Trading Commission (CFTC) and the United States Securities and Exchange Commission (SEC) over crypto assets.

Simply put, the approach intends to give both regulatory bodies joint power in regulating the digital assets industry. It will assist in identifying which digital assets are securities and commodities in addition to safeguarding institutional and retail investors and consumers.

“Unfortunately, our current regulatory framework is preventing digital assets’ innovation from reaching its full potential. The SEC and the CFTC are currently in a food fight for control of these asset classes,” Representative Patrick McHenry stated.

While the bill may present a promising future for crypto assets, US lawmaker Brad Sherman has pointed out its negative impact on the industry and the US. Addressing its effect in the short-term, Sherman noted that the measure will lead to the disempowerment of the US SEC.

Furthermore, Sherman claims the pro-crypto act could lead to no or fewer regulations for cryptocurrency. He believes that the approach could gut all securities regulations for the stocks and bonds that power the US economy.

A Competitor To The US Dollar

Meanwhile, in the long term, Sherman believes that crypto will create a new currency (cryptocurrency), which he says is “hidden money,” outside the US tax laws. Thus, if the bill is approved, the US will be unable to enforce its laws against those who utilize these assets for illicit activities, such as drug dealers, child traffickers, and others.

Also, Sherman believes the inception of the act will create a new competitor to the US Dollar, given that digital assets, particularly Bitcoin, is already being considered by many as a better store of value than the US Dollar.