With Rep. Patrick McHenry (R, NC) finally in his House Financial Services Committee Chair last week, the congressman whipped up a selection of subcommittees that will carry his party’s financial services agenda in the 118th Congress.
Among them, a committee devoted to digital assets: The Subcommittee on Digital Assets, Financial Technology and Inclusion led by Rep. French Hill (R, AR), a former banker.
Still to be populated with House Financial Services members from both sides of the aisle, there will be no other committee like it in Congress: digital assets and fintech-focused, all the time.
Bipartisan support for crypto legislation has been a key element of driving digital assets discussion in DC to-date (RFIA, DCCPA, DCEA and stablecoins) even if bills have yet to cross the finish line into law. With a wide spectrum of political viewpoints unifying over a common cause AND attempting to navigate a divided government, this committee would seem to be at the tip of the bipartisan crypto spear.
Topping the agenda for the new subcommittee will be working with (if not helping dictate along with Chair McHenry’s guidance) what the SEC, CFTC, the Fed and any other applicable regulator should do about digital assets and thereby define their jurisdictions.
This will be a years-long, legislative journey as technology and products evolve. But it has to start – or continue – somewhere.
Rather than hashing out cryptocurrency legislation with former Chair and now, presumably, Ranking Member Maxine Waters (D, CA) amidst the House Financial Services Committee’s expansive overall agenda, the subcommittee can go deep more often – and publicly.
Given the stakes of cryptocurrency’s potential affect on the US economy and, most importantly, the primacy of the US dollar, public discourse makes sense.
It’s also not surprising that McHenry chose to make diversity and inclusion part of the digital assets subcommittee’s title and remit. Reading the press release from the new Chair’s office on the new subcommittees and their leadership, each committee description has a bullet on diversity and inclusion (D&I). Digital assets has two:
- “Developing policies that promote financial technology to reach underserved communities”
- “Identifying best practices and policies that continue to strengthen diversity and inclusion in the digital asset ecosystem”
How does diversity and inclusion fit?
For one, if digital assets are a huge opportunity ahead, unlike past financial investment opportunities where those with money and access made still more money, this time underserved communities will potentially have a headstart or a more level playing field – at least it’s positioned that way. Today’s U.S. financial industry regulations largely prevents the banking system from dipping its “toes” in speculative crypto markets. Of course, where this all “butts heads” with accredited investor rules remains to be seen.
From McHenry’s point-of-view, the D&I focus will hopefully appeal to the former HFS Chair Rep. Maxine Waters (D, CA), and now presumably Ranking Member, whose Diversity and Inclusion HFS subcommittee in the previous Congress has been scrapped and re-worked across all HFS subcommittees in the Republican-controlled Congress.
This could also resonate with Congressional staff members who took part in a Commodity Futures and Trading Commission (CFTC) roundtable last August.
Appointments from both sides of the aisle for the Digital Assets Subcommittee are imminent next week. In the wake of the crypto contagion of 2022, pushing a protective layer of potentially restrictive legislation will be on the minds of many. Given the nascent state of crypto, Rep. McHenry and Rep. Waters will be balancing this legislative momentum with something smart and long-lasting for the United States.