“Indian Crypto Industry Celebrates as US House Passes FIT21 Bill: Major Victory for Web3”
Indian commentators in the crypto sphere are deeming this development as ‘historic’ and ‘pivotal’ for the worldwide crypto industry.
The US House of Representatives recently approved a new bill aimed at regulating the crypto sector, known as the FIT21 (Financial Innovation and Technology for the 21st Century Act). While awaiting approval from the US Senate, stakeholders in India’s crypto and Web3 space have praised the bipartisan decision made by both the Democratic and Republican parties in the US. Indian crypto commentators are hailing this development as ‘historic’ and ‘pivotal’ for the global crypto industry.
The US is recognized as the world’s largest crypto market. According to Security.org, 40 percent of American adults now possess crypto assets, up from 30 percent in 2023. Decisions made regarding cryptocurrencies in the US have a significant impact on the global crypto sector. The approval of BTC ETFs by the US SEC earlier this year resulted in a substantial influx of billions of dollars.
Assessing the influence of the US on the crypto industry’s trajectory, commentators from India’s Web3 sector suggest that the US regulatory framework for crypto could yield positive outcomes. Speaking with Gadgets 360, Sharedeum co-founder and CEO Nischal Shetty discussed the potential implications of the bill for Indian crypto enthusiasts.
Shetty emphasized, “The US is taking a crucial step towards integrating crypto assets into traditional markets, a move that India should closely observe. The passage of the FIT21 Act marks a significant victory for the Web3 ecosystem. By providing regulatory clarity and fostering innovation, this legislation has the potential to drive broader crypto adoption and expand the Web3 landscape.”
Despite offering advanced financial services, the crypto sector grapples with uncertainty due to the complex nature of digital assets, resisting easy categorization. Prioritizing the segregation of these assets into securities or commodities and ensuring their lawful use is a key focus for not only the US but also other nations.
According to Shetty, the US’ initiative to differentiate between various categories of crypto assets will have far-reaching implications on the global crypto industry.
“To seize upon this momentum, it is essential to concentrate on nurturing the Web3 ecosystem in India. This entails educating young people about Web3, expanding the pool of developers involved in Web3 projects, and generating more career prospects within this domain. With the clarity and backing offered by initiatives such as FIT21, we anticipate a substantial uptick in adoption, ultimately resulting in improved tax regulations and regulatory frameworks,” Shetty elaborated.
The initial approval of FIT21 precedes the anticipated approval of Ether ETFs in the US. While awaiting clearance from the US Senate, the timing of these legislative approvals has been described as a pivotal moment for the crypto industry by Avinash Shekhar, co-founder and CEO of Pi42, a crypto-INR futures exchange.
Shekhar observed that these regulations could potentially decrease the involvement of the SEC in overseeing the industry. Previously, the actions of the US SEC have been criticized by the global crypto community, who argue that the regulatory body’s investigations into numerous digital asset firms on allegations of irregularities often impede the growth of crypto.
Despite advancements, the crypto sector faces numerous allegations of fraud and financial irregularities involving major companies. In November 2022, the collapse of the FTX crypto exchange occurred amid regulatory and legal scrutiny over fraud allegations. The subsequent investigation and trial resulted in the former CEO and co-founder, Sam Bankman-Fried, receiving a 25-year prison sentence in March. Similarly, Binance, the world’s largest crypto exchange, and its co-founder Changpeng Zhao faced money laundering charges in the US. Zhao eventually accepted a plea deal and was sentenced to four months in prison in April. These scandals have significantly impacted investor sentiment, leading to a decline in the prices of most assets.
Nevertheless, Shekhar believes that the bill could greatly contribute to bringing regulatory clarity to the sector. “This represents a significant victory for crypto as it delineates the regulatory roles of the SEC and CFTC in overseeing crypto. The FIT21 bill is viewed as a critical step toward providing the regulatory clarity necessary to facilitate the growth and maturity of the digital asset ecosystem in the US, while safeguarding consumers and preserving market integrity,” Shekhar emphasized.
In India, there is a gradual rollout of crypto regulations aimed at ensuring the safety and legal compliance of investors, traders, and companies involved in digital asset trading and related services.
