House Republicans drops bold crypto bill draft to tighten control

House Republicans have introduced a draft of a sweeping discussion on regulating cryptos and digital assets.

The measure, unveiled Monday, comes from senior GOP members of the House Financial Services and Agriculture Committees, including Reps. French Hill (Arkansas), Bryan Steil (Wisconsin), Glenn “GT” Thompson (Pennsylvania) and Dusty Johnson (South Dakota).

The draft precedes a critical hearing set for Tuesday, entitled “American Innovation and the Future of Digital Assets: A Blueprint for the 21st Century. Legislators are expected to discuss the future of digital assets in the United States and the best way to regulate the nascent industry.

Hill said they had made historic progress during the 118th Congress in building bipartisan and bicameral agreements to create a workable regulatory framework for digital assets. He added that the new discussion draft builds on that foundation and offers much-needed clarity for the digital asset industry by protecting consumers and ensuring the long-term stability of digital asset markets in the United States.

The bill is an offspring of the Financial Innovation and Technology for the 21st Century Act (FIT21), which passed the House last year. That earlier bill sought to determine which agency — the SEC or the CFTC — would have a purview of different aspects of the crypto space.

Lawmakers clarify regulatory duties for SEC, CFTC

One of the most significant elements of the new proposal is how it delineates the roles of the SEC and the Commodity Futures Trading Commission (CFTC)

The bill would establish a structure that would divide oversight according to the form and function of a digital asset.

If a digital asset is decentralized and in operation — like Bitcoin, for example — it would be considered a digital commodity. That makes it subject to the CFTC. Then, the SEC would have jurisdiction if such a token is not decentralized or if it is still under an issuer’s control.

The proposed legislation seeks to resolve one of the most pressing challenges in U.S. crypto regulation: persistent legal uncertainty. Businesses and developers have long expressed frustration over the lack of clarity regarding which federal agency has jurisdiction and how their projects will be regulated.

The draft bill introduces a “clear path” for companies to register with the appropriate authority—either the SEC or the CFTC—based on the nature of their digital assets. It also outlines detailed procedures for how exchanges dealing with digital commodities would be registered and supervised by the CFTC.

According to a one-page bill summary, the framework would also allow digital asset projects to raise capital under existing SEC guidelines while offering a transition route for those assets to be treated as commodities under CFTC oversight.

House committees hold hearing on crypto oversight draft

The House hearing on Tuesday is likely to be a significant step. It will be held by two subcommittees: the Agriculture Subcommittee on Commodity Markets, Trading and Credit and the Financial Services Subcommittee on Commodity Exchanges, Energy and Credit.

Lawmakers will likely question experts, regulators, and industry executives about what the bill may mean for innovation and safety in digital markets.

So far, participants in the crypto industry have been excited about the promise of a regulatory framework for their operations. Many deemed this bill a great first step, although some warn that it may open loopholes or create new issues.

Its advocates have also said it could help the United States compete worldwide. Other nations, including the U.K. and E.U., have already implemented clear rules of engagement for crypto. The U.S. is falling behind.

However, critics argue that enhancing the CFTC’s authority might be a consumer loss, as the agency has historically favored the markets over the protection of investors .

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