Cryptocurrency firms spent big in 2024 to deliver a GOP-controlled Washington — and they got it. Now, the policy is starting to come into focus. Sen. Tim Scott (R-S.C.) and Rep. French Hill (R-Ark.) are set to lead the charge on the industry’s long-sought overhaul of crypto regulation as the incoming chairs of the Senate Banking and House Financial Services committees. Hill, who played point on outgoing Financial Services Chair Patrick McHenry’s digital assets legislation this Congress, was crypto firms’ top choice for the job. Both men previewed their thinking at the Blockchain Association’s policy summit last week. In an interview in his office the next day, Hill got more granular. The former banker wants to use McHenry’s bills as a starting point for negotiations in 2025 — and says it makes sense for the House to jump-start the process, since the Senate will be busy processing President-elect Donald Trump’s nominations. “We still will go into this new Congress with the general consensus where we ended this Congress,” Hill told your host. He added that he’s already met with Trump’s artificial intelligence and crypto czar, David Sacks, on how digital assets legislation and regulation can dovetail with each other. Both Hill and Scott say they anticipate changes to this Congress’s bills— and that they want to work with Democrats, instead of forcing through partisan proposals. Hill says crypto firms should get ready to cede ground. “I've talked with everybody inside the digital ecosystem,” Hill said. “I would argue to that leadership, ‘We need to make sure we stay focused on the forest … and that it is going to be a compromise process.’” In an interview last week, McHenry warned that the industry’s ability to shape legislation will depend on its ability to give and take during the policymaking process. “Crypto’s long-term influence is a question of their long-term engagement,” he said. “We saw this in the politics of the election, but hopefully we'll see that in the policy engagement and long-term set of politics and ensuring that it's bipartisan.” Of course, the House and Senate Agriculture chairs will also have a say on any bill that would divide oversight of digital assets between the SEC and the CFTC. Incoming Senate Agriculture Chair John Boozman (R-Ark.) has already met with Hill to talk crypto, spokesperson Sara Lasure said — and is weighing the creation of a new panel that could take the lead on legislation. “Senator Boozman is considering everything, including the idea of creating a more CFTC-focused subcommittee given the important risk management function derivatives markets serve, and the continued growth of the digital asset marketplace,” Lasure told your host. She added that “this is a conversation Senator Boozman will be having in the coming weeks with members of the Senate Ag Committee.” Sen. Kirsten Gillibrand (D-N.Y.) said in an interview that she’d be interested in serving as the top Democrat on such a panel, be it on Agriculture or another committee. Her partner on several crypto bills, Sen. Cynthia Lummis (R-Wyo.), said she’s still interested in chairing Senate Banking’s new digital assets subcommittee — something Scott recommitted to creating last week. Lummis added that the committee will prioritize scheduling testimony on “Operation Choke Point,” or regulatory pressure on banks to cut ties with clients like crypto firms. “We're going to have hearings about the wrong-headedness of bank examiners having the power to cut people's access to capital,” Lummis said. “That will happen early.” As for who else could populate those panels, Republicans this month named several new members of House Financial Services and Senate Banking with crypto-friendly track records. All four GOP senators who gained Banking seats have “A” ratings from advocacy group Stand With Crypto, as do four of the six House Republicans joining Financial Services (the other two do not have ratings). “2024 was an important year for crypto in Congress and we believe it has helped set the stage for key legislation to advance in support of the industry,” Ji Kim, an alumnus of Gemini and Kraken who now serves as chief legal and policy officer at the trade association Crypto Council of Innovation, told your host. This “should be the most pro-digital asset Congress we have yet seen.” HAPPY CHRISTMAS EVE — And thank you for reading the last Morning Money of 2024, where your host is eternally grateful to be flying out of DCA tonight with a funded government and recessed Congress. As always, Hill musings are welcome at emueller@politico.com. The captain of the ship, Sam Sutton, will be back in 2025. You can reach him in the meantime at ssutton@politico.com.
|
No comments:
Post a Comment