McHenry disclosed the move when announcing broader plans for financial services subcommittees and their chairs.
why is it important: The creation of the Digital Assets Panel highlights how crypto has come to dominate the financial regulatory agenda in Congress. In the past, the Financial Services Committee has largely focused on oversight of banks, Wall Street firms and their regulators.
The digital asset industry has become a lobbying force in recent years as startups attempt to lay the groundwork for a friendly regulatory environment, gaining allies on both sides of the aisle. Crypto firms now find themselves playing defense after a dramatic crash in recent months and the implosion of former giant FTX, which sparked accusations of fraud against top exchange executives.
The new subcommittee will hold hearings and play a key role in the development of bills.
McHenry, who has put crypto regulation at the top of his legislative agenda, said the panel would be tasked with providing clear rules for federal regulators and developing policies that promote fintech to reach underserved communities.
“We need to respond to surveillance and policymaking on a new asset class,” he said.
Meet McHenry’s Top LieutenantsMcHenry also named the chairs of its other financial services subcommittees, amounting to a big overhaul of the leadership structure. They understand:
- Capital markets — Rep. Anne Wagner from missouri
“Wagner hasn’t been shy about her interest in capital formation — and so she’s in the right position to move policy forward,” McHenry said.
- Financial institutions and monetary policy — Rep. Andy Barre from Kentucky
“Barr brings a rural perspective, but he is [also] been a serious decision maker since coming here,” McHenry said.
- National Security, Illicit Finance and International Financial Institutions — Rep. Blaine Luetkemeyer from missouri
“China is an imminent threat,” McHenry said, and “Luetkemeyer has a unique voice on this.” He is also “deeply knowledgeable for comprehensive oversight of FinCEN.”
- Monitoring and Investigations — Rep. Bill Huizenga from michigan
“Huizenga is in the right position to lead our surveillance initiative at a time when we have an administration that is well out of bounds,” McHenry said.
- Housing and insurance —Davidson
“In bringing Davidson into the leadership team, he clearly has a deep interest in technology and is well versed in cryptocurrency,” McHenry said. This brings his perspective to a sub-committee skill where it is necessary to inject these ideas.
McHenry’s dilemma: Subcommittee chairman assignments — under the radar but powerful Washington perches — marked McHenry’s first big challenge as he took the reins of financial services. He was bound to disappoint some of his best members no matter what he decided, as he had to wrestle with how to handle term limits for Luetkemeyer and Huizenga as well as the interest of several members – especially Wagner – in Chair the Financial Markets Sub-Committee.
Luetkemeyer and Huizenga had reached six-year GOP term limits at the top of their longtime subcommittees — financial institutions and capital markets, respectively — and will have new assignments this Congress. Wagner, who last Congress was the only Republican woman on the committee, was previously the top GOP member on the diversity and inclusion subcommittee.
It was unclear until Thursday whether McHenry would honor the Republicans’ internal term limit mandate, and his decision has come under intense scrutiny by lobbyists who work with the financial services.
“I made it very clear to our subcommittee leadership that I was going to respect the term limits of those subcommittees,” McHenry said. It corresponds very well to the talents of the people, to their ability. … This means that we bring new opinions to all the sub-committees.
A new approach to diversity and inclusion: McHenry abandons diversity and inclusion subcommittee created by Rep. Maxine Waters (D-California), who chaired the committee when Democrats had a majority.
In his place, McHenry tasked each sub-committee with identifying best practices for strengthening diversity and inclusion in their areas of expertise.
“We have bipartisan concerns about a lack of focus in our economy on broader diversity initiatives, inclusion initiatives, the nature of equity in our society,” he said. This should therefore concern the whole of our jurisdiction. Frankly, my fellow Democrats should consider this a big win. We didn’t have to. … But talking to my members and watching these subcommittee hearings, there’s a lot to learn and there’s a lot to learn domiciled in the expertise of the subcommittees. You can’t have this conversation separate from the rest of the policy-making.
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