Washington, D.C. - Today, Congressman and Majority Whip Tom Emmer’s (MN-06) Securities Clarity Act passed the House of Representatives after being included in the Financial Innovation and Technology for the 21st Century (FIT21) Act. The Securities Clarity Act marks a significant step forward in providing market certainty for innovators and clear jurisdictional boundaries for regulators.
“This is an important opportunity for the United States to lead. With the passage of the Securities Clarity Act and FIT21, American digital asset innovation can flourish. This globally competitive framework will give entrepreneurs the clarity and assurance they need to build here, in the United States, while ensuring the next iteration of the web emulates our values,” Emmer said.
Before today’s vote, Whip Emmer delivered the following remarks on the House Floor in support of the Securities Clarity Act and the Financial Innovation and Technology for the 21st Century (FIT21) Act:
“Today, we have an opportunity to determine whether the next iteration of the internet will be designed by Americans or if it will instead reflect the values of some other nation. The FIT 21 Act gives us that opportunity and unlocks a larger conversation beyond innovation. This bill is about national security. It’s about consumer protection. It’s about global competitiveness. It’s about shaping what the future global digital economy looks like and how it functions. Currently, all online transactions are intermediated. But as we move deeper into the digital age, digital assets are key to decentralizing the internet so Americans can transact directly with each other, no intermediary needed. Without crypto, we don’t have this ability, and I think giving Americans the choice to do business through an intermediary or directly with each other is important. Having that choice will fundamentally alter the digital economy, unlocking new opportunities for Americans and individuals across the world in ways we haven’t even begun to contemplate. However, this Congress can no longer stand by as regulators squander this opportunity right within our grasp. This Administration has demonstrated they simply are not willing to allow the digital asset industry to innovate in the United States. For every legal inconsistency or regulatory hurdle they produce – instead of coherent and informed guidance –they drive American digital asset users into less safe jurisdictions. That’s why the FIT 21 Act is significant – to set clear and consistent rules for American innovators. Among the many important provisions in this bill is my Securities Clarity Act, bipartisan language tailored specifically to digital assets that provides the legal flexibility for a digital asset project to transition from centralization to decentralization. This transition is critical to the future peer-to-peer digital economy, and I thank the Chairmen and my friends on the other side of the aisle for working with me to incorporate this section into the bill today. Their work on this extensive framework will allow Americans to once again lead the way.”
Background:
Current securities laws have not adequately distinguished between an asset and the securities contract it may or may not be a part of. As such, many cryptocurrencies may initially be issued as part of a securities contract, however, once the project becomes fully developed and decentralized, the token could fall under a different classification, such as a commodity.
The Securities Clarity Act addresses this issue by offering an important distinction that allows crypto projects to thrive in a compliant manner. This bill is crucial for ensuring that the United States remains a global leader in digital assets by creating an environment that fosters innovation.
As Title II of the Financial Innovation and Technology for the 21st Century Act, the Securities Clarity Act establishes the unique American position that a digital asset is not itself a security, but that it can be offered as part of a securities contract. This distinction accommodates for the development of a digital asset project from centralization, where it’s controlled by developers and/or investors, to decentralization, where the technology runs on its own and is not controlled by anyone.
Emmer first introduced the bipartisan Securities Clarity Act with Representative Darren Soto (FL-09) in 2020. The Securities Clarity Act is supported by Coin Center, Blockchain Association, Chamber of Digital Commerce, and the Crypto Council for Innovation.
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