Garlinghouse Applauds Biden Administration as FIT21 Crypto Bill Passes in Congress

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Garlinghouse Applauds Biden Administration as FIT21 Crypto Bill Passes in Congress

Ripple‘s CEO, Brad Garlinghouse, celebrated the Biden administration, yet SEC chairman Gary Gensler was noted as a political liability. Garlinghouse’s comments come in the wake of the emergence of the much-anticipated FIT21 crypto bill in the U.S. Congress. This move has been widely considered to be a positive step towards enhancing the legal framework of cryptocurrencies.

Brad Garlinghouse Challenges Gensler’s Crypto Opinions

Specifically, 71 Democrat legislators supported the FIT21 crypto bill, which means that a significant number of them voted for legislation that representatives of the Republican Party supported. This indicates that people are dissatisfied with Gensler’s opinions regarding cryptocurrencies.

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Garlinghouse used a specific segment of the bill to argue that when mentioning the sale of digital assets under an investment contract, it becomes clear that the buyer acquires security. This opines that a digital asset cannot be categorized as a security simply by being sold or transferred under a catch-all contract. This segregation is important for the classification of the cryptocurrency industry because it clearly defines the way their assets are classified.


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Garlinghouse Criticizes Gensler Amid FIT21 Approval

The FIT21 bill includes clauses derived from the decision made by U.S. Judge Analisa Torres in the SEC vs Ripple case in July 2023. Judge Torres made her decision and stated that XRP is not a security that Ripple has released. This rather became a key win for Ripple in an ongoing legal war with the SEC.

The steps made by this judge did influence the legislation of digital assets, requiring lawmakers to adopt similar distinctions in the FIT21 bill. In the same way, the bill states that an asset is not transformed into a security just because it is bought under an investment contract, which corresponds to the legal decisions made by Judge Torres. This move to align with the legal precedents in the industry will give more legal certainty and backing to the crypto market.

That December, Garlinghouse penned Gensler as a ‘political liability,’ accusing him of prejudicially damaging consumers and the SEC’s credibility while politically entwined with Wall Street. He also pointed out allegations of hypocrisy against Gensler and claimed he was even involved in various massive financial scandals.

The US House of Representatives’ approval of the FIT21 crypto bill on May 22, 2024, has to be considered a major step in developing a rigorous approach to regulating cryptocurrencies. Experts describe this development as a positive step forward, pushing the industry towards a clear and stable direction.

The recent passing of the FIT21 crypto bill is a huge boost to the cryptocurrency industry since it aims to reduce loose legal loopholes. In light of Garlinghouse’s arguments, Gensler remains a subject of criticism, and tensions within the regulatory environment persist. This is a step toward a more clearly outlined and enacted system of regulation as the cryptocurrency niche progresses.

Read Also: Grayscale Submits Amendment to Ethereum Mini Trust

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