Republican Congressman Mike Flood of Nebraska, a soft-spoken second-term lawmaker, may not seem like the obvious candidate to lead the charge on cryptocurrency policy in Congress. However, he played a key role in May when his colleagues made history by voting to pass two measures that would establish regulations for the industry.
Flood, who co-sponsored both pieces of legislation, was instrumental in gaining bipartisan support for the Financial Innovation and Technology for the 21st Century Act (FIT21) and a proposal to repeal a Securities and Exchange Commission rule known as SAB-121. He expressed surprise at the significant support from House Democrats for FIT21, which would allow cryptocurrency projects to certify their tokens as commodities, removing them from the SEC’s regulatory oversight.
Despite being a relatively new member of Congress, Flood’s experience in the Nebraska Legislature, including six years as speaker, gave him an edge. He also sits on the House Financial Services Committee’s subcommittee for digital assets and financial technology.
In an interview with Cointelegraph, Flood revealed that his interest in cryptocurrency began while serving on the Nebraska Legislature Banking Committee, where he championed the Nebraska Financial Innovation Act. Flood acknowledged that while crypto may not be a dominant topic in Nebraska, younger people and business students at the University of Nebraska are increasingly interested in digital assets.
Flood identified Rep. French Hill and Rep. Warren Davidson as key figures in Congress for their expertise in banking and digital assets. He expressed his optimism about the growing bipartisan support for cryptocurrency policies, highlighting that even House Democrats voted for FIT21, indicating a shift in attitudes toward crypto regulation.
Concerning the controversy surrounding members of Congress trading stocks or cryptocurrencies, Flood emphasized the need to ensure that policymakers are not trading on insider information. He called for a review of the existing rules to prevent unethical trading practices.
Looking ahead, Flood stressed the importance of passing FIT21 and stablecoin legislation in the next Congress. He also emphasized the need to understand artificial intelligence and cybersecurity and acknowledged the critical role of regulatory agencies in implementing crypto-related rules.
Flood’s primary focus on stablecoins is to ensure a state pathway in the legislation, allowing state-chartered banks to participate in the digital assets space. He argued that restricting states’ involvement in regulating stablecoins would hinder innovation and diversity in the financial system. He underscored the importance of states’ rights and their capacity to understand and regulate digital assets effectively.
In conclusion, Flood emphasized the importance of embracing innovation in the financial sector and empowering states to regulate digital assets. He highlighted the need for a balanced approach to cryptocurrency regulation that protects consumers while fostering growth and economic development.