CryptoLink - September 2023 Updates
A government shutdown has been temporarily avoided in Washington, with a reprieve that gives Congress until the middle of November to negotiate some resolution on spending for the fiscal year. With the Speaker’s chair now vacant, and temporarily filled by House Financial Services Committee Chairman Patrick McHenry, the opportunities for meaningful non-spending legislation to make its way across the House floor before Thanksgiving are few. Still, in spite of the distractions, committees have been and will continue to do their work. Several recent hearings and markups have focued on digital assets policy and legislation. The Senate Banking Committee held an oversight hearing of the Securities and Exchange Commission (SEC), where SEC Chair Gary Gensler in his testimony called on the Committee to fund efforts to regulate the crypto sector, justifying this budget request as necessary to combat “daunting” levels of crypto fraud. Gensler’s hostility towards crypto faced little resistance from Committee Democrats—Chair Sherrod Brown (D-OH) in his opening testimony stated: “We only need to look to events in the crypto markets in the past year to see what happens when markets lack transparency and conflicts go unchecked,” and that “bad actors keep flocking to crypto.” By contrast, the Republican majority at the House Financial Services Committee continue to prioritize legislating on crypto issues. The Committee held a hearing on restricting the Federal Reserve’s ability to issue a Central Bank Digital Currency (CBDC) and held a subsequent markup, during which a bill that would prevent the issuance of a CBDC without explicit authorization from Congress was passed out of Committee along party lines. It is fair to say that both committees and both Chairman are currently positioning themselves for an end of year deal on financial services policy, where Chairman McHenry’s top priorities remain his bipartisan market structure and stablecoin bills.
