The odds are high that crypto legislation will get signed into law ahead of the U.S. presidential election in November , Patrick McHenry, chair of the House Financial Services Committee, said last week at Coinbase’s Update The System summit in Washington D.C. 

“We’ve got more opportunities now and that’s not a normal thing for an election year,” said McHenry. The speaker of the house, Mike Johnson, who has now been in the job for five months, is in “deal-making mode.” McHenry, who has been critical in pushing these bills forward, spent three weeks in the speaker’s chair in the fall of 2023, and had hoped all actions would be taken care of by now. 

“What we need are four votes, so I’m working with my leadership in the House to get four votes scheduled,” he said. “We had a welcome set of bills that we put together in the legislative package for capital formation and changing securities law. We passed that two weeks ago out of the House. Since we had bipartisan votes in committee on the Financial Innovation and Technology for the 21st Century Act (FIT 21), the market structure bill, the stablecoin bill, and a good piece of legislation saying no to central bank digital currencies (CBDCs), we have opportunities to move those on the House floor.”

The chairman shared his frustrations with the pace of policy, and the agencies’ inability to make decisions. 

His original undertaking was to take a new approach to digital assets, then political realities set in. “Frankly, I make policy in the midst of politics. I’m trying to get the best policy I can in the context that I’m given,” he added. “In this circumstance, we’ve taken what is a traditional securities approach and traditional commodities approach.” McHenry expressed his frustrations with Gary Gensler, the chairman of the Securities and Exchange Commission. The SEC has recently lost notable court cases related to crypto regulation. 

“Congress has to say, this is what the SEC does and this is what the CFTC does,” McHenry said. “This is what a digital commodity is. This is what a digital security is. This is not some brand-new design. It’s pretty simple. Unfortunately, very few members of the House and Senate spend their time on securities and commodities laws.”

Chicken or the egg 

Sound rules of the road come first, to remove the fear that capital that’s deployed will be made useless by legislation that changes property rights, McHenry said. He added that education is the key for policymakers and their staff members. 

McHenry is hopeful stablecoin legislation will be ready to debate soon. “We’re at the phase where we can see the airport, we can see where we’re going to land, we can see how we’re going to land, we just don’t know when we’ll land the plane,” he said. “Will we have legislative vehicles to get signed into law? Those chances have increased once we fund the government, which gives us the opportunity to land a product like a stablecoin bill.”

He said the momentum is on the side of stablecoin legislation. “There’s goodwill enough to answer the President’s executive order on the need for federal stablecoin legislation,” he said, “from the work that [Maxine] Waters and I have been about for the last 20 months.”