The middle of July, from the 14th to the 18th, was a point that the crypto market, conversion tools, exchanges and the entire ecosystem galvanised around as a turning point for the whole industry.
What came out of Crypto Week perhaps raised more questions than answers, and the desire for clarity in the market that cryptocurrency revolves around the most continues largely unsatiated.
This can be seen in the market reaction to Bitcoin; whilst the excitement building up to Crypto Week boosted BTC over the $120,000 milestone, more optimistic estimates that it could reach further heights have gone unfulfilled so far and could be potentially delayed by a month or more.
To explain why, we need to look into three major pieces of legislation that were to act as the foundation for cryptocurrency in the United States, and amidst a chaotic number of days on the floor of the House of Representatives, try to find out what it means now and in the future.
The GENIUS Act
The biggest piece of positive news that came from Crypto Week was the passing of the GENIUS Act, a major milestone moment that provides regulation for cryptocurrencies classed as stablecoins.
Short for the Guiding and Establishing National Innovation for US Stablecoins Act, the GENIUS Act managed to enter law just before the end of the week, but the manner in which it did so signposted potential issues that dampened the market slightly.
The GENIUS Act established a framework for private companies to issue stablecoins, requiring them to back them fully with real liquid assets as well as subject them to oversight and financial audits.
The bill passed the House, but it took two historically long sessions to do so, despite having enough bipartisan support to make its passing a formality.
Part of the reason for this is outside the scope of crypto, but another part of this was disagreements over some of the specifics of the regulation.
The disputes are complex, but the primary argument is that it allows stablecoin issuers to act like banks without having the same oversight or provisions in place should the company go bankrupt.
The House vote was the longest since records began, clocking in at nearly ten hours (nine hours, 45 minutes) and taking multiple days to pass one of the three bills.
The CLARITY Act
The second bill, the Digital Asset Market Clarity Act, was significantly more broadly encompassing, intending to create a regulatory framework for all crypto assets and determining which parts would be overseen by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
The intention is to clarify which types of tokens qualify as securities, which would be subject to scrutiny under the SEC and have been a point of contention for years as legislators attempt to navigate the blockchain and its many different purposes.
The hope is that it would help remove uncertainty from developers, who have designed tokens and tools without being entirely sure under which laws they will operate.
It has passed the House, but the chaos surrounding the voting sessions has meant that it missed an opportunity to be voted on in the Senate before both Houses take a recess over the summer.
It is likely to still pass, although the effects on the market remain to be seen, and whether it will galvanise the momentum that was seen in the buildup to Crypto Week.
Anti-CBDC Surveillance State Act
The final bill, the Anti-CBDC Surveillance State Act, is ultimately designed to stop the creation of a digital dollar.
Specifically, it prohibits a Federal Reserve bank from issuing a central bank digital currency, based on concerns that such a system built on the blockchain could potentially give the government access to a person’s transactions.
This particular bill has confused some financial and legal analysts, as the Federal Reserve had no plans to issue a CBDC.
It ultimately passed across party lines but will need to pass the Senate before it can be written into law.
What Happens Next?
As Congress is in recess, no further laws can be voted on until then, meaning that two of the three milestone bills from Crypto Week remain in limbo. Whilst the numbers suggest that both will pass, time will very much tell.
The GENIUS Act is a success, and the potential establishment of mainstream stablecoins could potentially galvanise the market more as people feel more confident to at least convert fiat currency into stablecoins, but time will tell as to the true effects of the bill.