His committee is now looking at other issues, like tokenization and lawmakers’ role in that area, he said. The Financial Services Committee held a hearing on tokenization in late March, which Hill said was aimed at helping lawmakers consider what the Securities and Exchange Commission (SEC) and bank regulators might need in terms of additional authorities or rules to facilitate companies engaging in tokenizing real-world assets.

Part of this effort is determining whether there even needs to be a legislative effort, or if policymaking could remain at the regulator level, he said.

“Tokenization of an asset, such as a common stock, is really an exercise in changing systems,” he said. “It’s not changing the law. All the legal or regulatory requirements about common stock are also applied to a common stock token, right? And so in our view, that’s why these hearings bring up member awareness.”

The House and Senate, as overseers of the regulatory agencies, can, for example, use hearings to ask how existing systems can be adopted to blockchain-based systems, he said.

In a similar vein, Hill said he was looking at the possible tokenization of deposits in the commercial banking industry, which could enable direct debit payments without needing an intermediated stop.

This isn’t necessarily imminent, but it is an area that his committee may explore, he said.

“You think about going from call-out markets right to paper-based markets to digitization of that paper-based system, which took place in the 1970s and 1980s, and that’s increased accuracy, reduced fraud, increased speed, decreased the need for liquidity [and] improved settlement,” he said. “We went from T+5 on equities in the 1970s to T+1. So to me, this is an operating decision, and the interoperability of it is the biggest challenge, not the mechanical, technical aspect of doing it.”

Tokenized markets will, therefore, need work on interoperability and compliance, he said.

“We’ll find out if there needs to be some, you know, legislative activity versus purely regulatory, and that’s good. That’s what Congress’s job is,” he said.

The other major topic he’s tracking — at least in the crypto world — is the effort to update tax regulations around digital assets, he said. The House Ways and Means Committee is already working on tax issues, and a bipartisan group of lawmakers reintroduced a bill specifically targeting crypto taxes earlier this month.

And of course, there will be an election later this year that will determine control of the House of Representatives and Senate. The crypto industry is, as it was in 2024, heavily engaged in primary races, trying to bolster candidates that the various political action committees see as being friendly toward crypto.

Hill said the Financial Services Committee in particular has long been engaged in digital assets, referencing work by former Rep. Patrick McHenry and his Democratic counterpart, Rep. Maxine Waters, over the past 10 years.

“In the past four years, we’ve seen the digital assets ecosystem really engage, not only on policy points, but also politically,” Hill said. “And you saw that in the 2024 election … So I anticipate that the digital assets ecosystem, political activity will be important to the 2026 election. It’s bipartisan. It’s supportive of people who are pro-innovation.”

Hill said the industry’s political engagement in this year’s vote is important, and that there is already bipartisan appetite for crypto.

“If we’re successful in GENIUS rulemaking, and we’re successful in passing Clarity, you’ll commence about a 12-month joint rulemaking process between the CFTC and SEC,” Hill said. “And I really think policy attention will track back into the regulatory agencies to try to make sure that our vision in the House of an integrated, common, fit-for-purpose approach is absolutely implemented.”

This week

Thursday

If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at nik@coindesk.com or find me on Bluesky @nikhileshde.bsky.social.

You can also join the group conversation on Telegram.

See ya’ll next week!

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