At the first 2025 market structure hearing, Congress moved to the Securities Act overhaul Act, aiming to curb and unleash a new era of US crypto innovation.
Congressional hearing alarms with SEC Overreach and Crypto Exodus
US lawmakers met in Washington on April 9th as the Subcommittee on Digital Assets, Financial Technology and Artificial Intelligence convened the first market structure hearing for the 2025 Congressional session. This session, led by Rep. Brian Steel of Wisconsin, titled “The Future of Innovation in America and the Digital Assets: Adjustment of U.S. Securities Act in the Digital Age,” analyzed how current regulatory ambiguity affects both innovation and investor protection in the digital asset sector. Testimonies from lawmakers and legal experts highlighted the growing consensus that U.S. securities law remains incorrectly in line with the operational reality of cryptographic technology.
“Last week, the committee took an important step to provide true legislative certainty for the payment stabilizing formula by moving forward with stable legislation,” Arkansas Rep. France Hill, chairman of the House Financial Services Committee, said. The lawmakers added:
It is mandatory for us to continue working towards a comprehensive regulatory framework that builds on that momentum and establishes clear rules for roads in digital asset markets.
Steil, chair of the subcommittee, emphasized his legislative obligation to act. “It is important for this committee to provide clear guidelines for issuers and market participants, to promote capital formation and maintain the integrity of the digital asset ecosystem and traditional financial systems.
Legal witnesses have called on Congress to define digital assets laws that will replace SEC-led regulations. Rodrigo Seira of Cooley LLP said: “Regulation, technological development and financial capital flows interact in patterns that are intertwined and repeated throughout history, and continue to live through the moment.
Tiffany J. Smith of Wilmer Hale encouraged legislation clarity, arguing that the SEC “is taking steps within its jurisdiction to provide regulatory clarity, but these actions alone are not sufficient.” She believes Congressional actions are “necessary for the digital asset industry to have real regulatory clarity.” Polygon Chief Legal Officer Jake Wellett said on the broader impact: “What began as a financial innovation is the foundation for decentralizing all forms of native digital assets.
Montana Rep. Troy Downing warned that the current U.S. Securities and Exchange Commission (SEC) stance could curb domestic leadership. He emphasized:
Treating all digital assets as security regardless of their purpose runs the risk of the US confiscating leadership in financial technology.
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