Sources hint at Nancy Pelosi’s support for the FIT21 crypto bill

Nancy Pelosi, the former United States House of Representatives Speaker, could be backing the Financial Innovation and Technology for the 21st Century Act (FIT21), a Republican-led crypto bill.

According to sources familiar with Pelosi’s approach, Pelosi could support the bill, which is currently on the verge of a vote on May 22.

Pelosi would be going against Democrats like Maxine Waters and David Scott, who have opposed the bill. However, a May 20 email leaked from Democrat Party leaders revealed that House Democrats won’t be urged to vote against it.

The bipartisan bill seeks to clarify cryptocurrency regulations in the U.S., addressing long-standing issues of market oversight and consumer protection. It will define the responsibilities of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). 

One of the key changes proposed by the bill is to redefine the SEC’s jurisdiction over crypto. This would be achieved by updating the 90-year-old Howey test to better suit the unique characteristics of digital assets, thereby creating a clear distinction between digital commodities and securities.

FIT21 has been widely welcomed by the crypto industry for its role in refining the regulatory landscape, primarily transferring oversight to the CFTC—a body noted for its more lenient approach towards the industry.

According to Mark Hays, a senior policy analyst on fintech with Americans for Financial Reform, this change aligns with the industry’s preference for the CFTC’s more accommodating regulatory approach, which has been a longstanding demand.

As of now, at least eight House Democrats have publicly vowed support for the bill, according to a recent memo, including Reps. Wiley Nickel (D-N.C.), Yadira Caraveo (D-Colo.), Jim Himes (D-Conn.), Jasmine Crockett (D-Tex.), Ritchie Torres (D-N.Y.), Darren Soto (D-Fla.), Josh Gottheimer (D-N.J.) and Don Davis (D-N.C.).

The lawmakers believe this bill “should not be a partisan issue” and is rather a “crucial opportunity” to regulate the cryptocurrency market.

Representative Nickel has previously called for lawmakers to support the passage of the bill on May 21 to “prevent the next FTX.”