Psaros Center for Financial Markets and Policy Distinguished Fellows Rostin Behnam (C’00) and Patrick McHenry sat down with moderator Mike Piwowar (MBA’94), Executive Vice President at The Milken Institute Center, for a lively conversation on the state of digital assets legislation.
McHenry, former Congressman and Chair of the House Financial Services Committee, said that when crafting legislation, Congress has to be “specific about the legislative text and congressional intent.” Nowadays, Congress has gotten too used to passing the work directly to agencies, and therefore gotten less rigorous with writing laws, he said.
“Do the hard work on the front end and be specific,” McHenry said.
Behnam, former Chairman of the U.S. Commodity Futures Trading Commission, said he doesn’t agree. He said the more prescriptive Congress is, the more difficult it is for an underlying regulator to have laws that can adapt and evolve from a market perspective. Given the pace of markets and rulemaking, the idea that Congress is going to have the time and expertise to write very bespoke rules around trade reporting and other specifics, such as how to set a limit on a commodity position, goes too far.
“It’s best suited for a regulator,” Behnam said.
So what’s next for legislation?
McHenry expects we’ll see what’s 90-95% the Digital Asset Market Clarity Act of 2025 (“Clarity Act”), which has passed the House of Representatives, enacted into law. Behnam is “a little bit less optimistic.”