Republican lawmakers express high hopes for digital asset legislation

Two Republican lawmakers expressed high hopes for the chances of passing digital asset legislation this Congress, speaking during a webinar Feb. 11 hosted by the Federalist Society.

Sen. Cynthia Lummis, R-Wyo., chair of the Senate Banking Subcommittee on Digital Assets, and Rep. Dusty Johnson, R-S.D., chair of the House Agriculture Subcommittee on Commodity Markets, Digital Assets and Rural Development, both said they have a positive outlook on what’s to come for cryptocurrency legislation this year.

“Behind the scenes, in the last Congress, there was so much resistance to digital assets, and it just placed a rock on all of our efforts, and now that rock is lifted, (and) we're working in cooperation with each other,” Lummis said during the webinar titled “Cryptocurrency After the Election.” “I think you'll find a better product coming out of this Congress, and it will still be bipartisan.”

In May, the House passed a bill aimed at establishing regulatory clarity for digital assets on a bipartisan basis. That bill, known as the Financial Innovation and Technology for the 21st Century Act, or FIT 21 Act, would give the Commodity Futures Trading Commission new authority by naming it the regulator for digital commodities while also maintaining the SEC’s authority as the regulator for digital securities. The legislation never passed the Senate, meaning it would need to be reintroduced this Congress.

Lummis said Congress will have to “marry” the FIT 21 Act with the bill that she and Sen. Kirsten Gillibrand, D-N.Y., previously worked on. That bill, first introduced in 2022, also gives the CFTC new power to regulate the crypto market, among other things, and Lummis contended that the differences between the bills are “fairly easily reconcilable.”

Senate Banking Committee Chair Tim Scott, R-S.C., and House Financial Services Committee Chair French Hill, R-Ark., are in contact about blending the bills together, according to Lummis, and “we'll get guidance from them once they come up with their strategy,”

“I just get the sense that we are going to get it done. We really are,” Johnson said of the legislation.

Aside from what lawmakers often refer to as a “market structure bill,” Congress is also looking to pass legislation regulating stablecoins. Lummis is one of four Republican senators that introduced such legislation on Feb. 4, while leaders in the House Financial Services Committee are working on their own version of a stablecoin bill.

Lummis said Congress will likely tackle stablecoin legislation before the market structure bill, “but I think they both get across the finish line this year.”

“We’ll turn our tables at some point to looking at (a) bitcoin strategic reserve,” Lummis added, though she gave the caveat that “I think we've got a lot of work to do on both sides of the aisle to make the use case for that.”

Lummis previously promoted her legislation that would create a bitcoin strategic reserve by having the Treasury Department purchase 1 million bitcoins over a period of five years and require such bitcoins be held for at least 20 years. That bill never moved out of the Senate Banking Committee and would need to be reintroduced this year.

Notably, President Donald Trump’s executive order that established a working group on digital assets directs the group to “evaluate the potential creation and maintenance of a national digital asset stockpile,” among other things.