Implementing FIT21 could be a ‘slow, slow process’ – CFTC Commissioner
Implementing the Financial Innovation and Technology for the 21st Century Act (FIT21) can be a lengthy process, requiring months or even years of coordination among U.S. regulators before the rules are implemented.
Summer Mersinger, Commissioner of the Commodity Futures Trading Commission (CFTC), made the prediction on a panel at the 2024 Consensus Event. Merzinger sees a slow regulatory process for the bill if it becomes law.
“If you think legislation is going to take a long time, rulemaking is going to take a long time. And some of the Dodd-Frank legislation we're not even done yet,” Mersinger said, adding that the length of the process will depend on how Congress passes the legislation.
“Regulation is a slow, slow process. And you think the bill has been signed, the president has signed it, it's all done. That's just step one. And then it really kind of hits the rubber meets the road. So it may take some time to implement the rules.
Once the bill becomes law, regulatory bodies such as the Securities and Exchange Commission (SEC) and the CFTC must enforce the new rules. It will include drafting detailed regulations, a public comment period, and possibly further amendments based on the comments received. In the year This phase can be extended for several months or years, as in the case of the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law in 2010.
The FIT2 Act successfully passed the House of Representatives with bipartisan support and is now facing continued challenges in the Senate. The law clarifies regulatory responsibilities between the SEC and the CFTC regarding digital assets.
Joe Biden's administration has expressed concerns about the bill, citing regulatory loopholes that could affect market stability, although it has not made clear whether it will be vetoed.
SEC Commissioner Hester Pearce, who also participated in the event's discussion, said that Congress's interest in crypto law is a response to the agency's enforcement approach.
“I think some of the reasons we're in this position is because Congress is sick of seeing the SEC do things that don't give people transparency.”
It's great that Congress is taking an interest in crypto, Pearce said, adding that it's a reminder that the SEC is using flexibility granted by Congress to think about “how the law applies to things that are difficult and new challenges.”
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