The cryptocurrency world is impatiently awaiting the federal government’s regulatory proposals on regulation—with several notable announcements this week.
- As Axios reports, serious figures within the crypto space are beginning to make inroads in Washington, DC.
- Last Thursday, the House of Representatives advanced the Financial Innovation and Technology for the 21st Century Act (Fit21).
- Crypto advocates do not agree on whether the act will advance an ideal legal framework for legal operations but agree that advancing legislation is vital for the industry.
- Unfortunately, GameStop has dropped its crypto wallet support due to “regulatory uncertainty of the crypto space.”
- Starting in November, users will no longer be able to use GameStop’s app to manage digital assets.
Why It’s Important
The crypto world is facing many challenges and ongoing issues that are threatening its future. Major exchanges like Binance and CoinBase are facing lawsuits from the federal government over allegations of securities fraud and liquidity issues. FTX founder Sam Bankman-Fried is facing criminal charges and trial this fall.
Among the more frustrating issues for traders has been the constant onslaught from the federal government—which has made it clear that it wishes to crack down on the industry without giving it a proper legal framework to operate legitimately.
Crypto has been staring down a widespread crackdown from the federal government in the past year, with the White House, the Department of Justice, the SEC, the Federal Reserve, and Congress all advocating cracking down on crypto. The asset continues to face an uphill battle with critics, with politicians like Senator Elizabeth Warren (D-MA) saying she is “building an anti-crypto army.” Republican politicians have generally been more friendly to crypto, as Democrats have soured on the concept following the collapse of FTX.
The advancement of Fit21 and the growth of pro-crypto lobbyists and advocates in Washington will likely help the industry, although industry insiders remain cautious. Multiple DC-based venture capital firms, miners, and advocates told Axios that nobody is in agreement about whether the legislation goes far enough to address potential issues and snags that could arise.
As we previously reported, GameStop is only the most recent company to back away from the crypto space due to federal hostility and regulatory uncertainty. Many prominent crypto firms and startups have moved out of the U.S. to London, Singapore, and The Bahamas, where the regulatory structure and culture are more amenable to crypto.