Challenges Ahead: Analyzing the Legislative Landscape for Cryptocurrency in 2024

Cryptocurrency Legislation Faces Challenges in 2024

Cryptocurrency legislation is expected to face obstacles in 2024 due to upcoming elections, potential opposition from SEC Chair Gary Gensler, and concerns from lawmakers about the effectiveness of proposed bills.

A Year of Ups and Downs for Crypto

2023 was a tumultuous year for the cryptocurrency industry, with events ranging from legal trials and charges against exchanges to some victories in court. These events will likely shape lawmakers’ approach to regulating the industry in 2024.

The Focus on Stablecoin Regulation

Two Republican-led bills have been the center of attention in the past year. One bill aims to regulate stablecoins at the federal level, while the other takes a comprehensive approach to crypto’s market structure. Both bills passed out of the House Financial Services committee, but face challenges in the Senate Banking Committee.

Challenges Ahead for Stablecoin Regulation

The stablecoin bill faces potential obstacles from both SEC Chair Gary Gensler and Rep. Maxine Waters. Gensler has expressed concerns about stablecoins falling under SEC jurisdiction, while Waters has criticized a provision that allows state regulators to approve stablecoin issuances without Federal Reserve input.

The Uncertain Fate of the Market Structure Bill

The Financial Innovation and Technology for the 21st Century Act, which seeks to regulate crypto at large, faces challenges due to potential SEC pushback and opposition from Rep. Waters and Sen. Brown’s silence on the issue.

Potential Impact of Bitcoin ETFs

If spot bitcoin exchange-traded funds (ETFs) are approved by the SEC in early 2024, they could help legitimize the crypto sector and influence legislative decisions.

The SEC’s Accounting Bulletin

The SEC’s Staff Accounting Bulletin No. 121 (SAB 121), which requires firms to record customer crypto holdings as liabilities, will be brought up for discussion in Congress in 2024.

Election Season and Crypto Legislation

Elections can have both positive and negative effects on crypto legislation. While lawmakers may be focused on re-election, it also raises awareness for crypto-related issues.