FIT-21 (Financial Innovation and Technology for the 21st Century Act)

FIT21 was H.R. 4763 in the 118th Congress, a bill that would have split US digital asset oversight between the CFTC and the SEC using a certification based decentralization test. It passed the House on 22 May 2024, went to the Senate Banking Committee, and expired unenacted when the 118th Congress ended on 3 January 2025. It is not law and it never became law. The live version of the same policy fight is the CLARITY Act, H.R. 3633, which is itself still pending.

Read this page as history and read the CLARITY Act page for anything current. FIT21 is still worth knowing because its decentralization test is the clearest published statement of what a legislative safe harbor might ask of a token, and the same concept carries forward into the bill now in the Senate.

What the bill would have done

The purpose clause was direct: to provide for a system of regulation of digital assets by the Commodity Futures Trading Commission and the Securities and Exchange Commission, and for other purposes.¹ The mechanism was a sorting test. A blockchain certified as decentralized, meaning no person or entity holds unilateral authority to control it, would put its asset on the CFTC side of the line as a digital commodity. An asset failing that test, or sold under an investment contract relationship, would stay a restricted digital asset under SEC authority.¹

The part that drew attention was the transition. FIT21 contemplated an asset moving from the securities side to the commodity side as its network matured, which existing law does not provide for in statute. That single idea is why the bill kept being cited in design conversations long after it stopped being live.

How it died

The House passed H.R. 4763 by recorded vote on 22 May 2024. The Senate received it and referred it to the Committee on Banking, Housing, and Urban Affairs. No Senate vote followed, and the bill expired with the end of the 118th Congress on 3 January 2025.¹

Nothing in that sequence is unusual for financial services legislation, and that is the point worth taking from it. House passage is a milestone, not an outcome. A bill that clears one chamber and stalls in committee is the normal case rather than the exception.

The handoff to CLARITY

The Digital Asset Market Clarity Act of 2025, H.R. 3633 in the 119th Congress, is the successor in substance. It passed the House on 17 July 2025 by a recorded vote of 294 to 134 on Roll No. 199, was referred to Senate Banking on 18 September 2025, and was reported out with an amendment on 1 June 2026.²³ Through that date it had not passed the Senate floor and had not been enacted.

One precision matters here, because secondary write ups blur it. No official Congress.gov cross reference designates H.R. 3633 as a formal reintroduction of H.R. 4763. The relationship is a substantive policy continuation, inferred from the shared CFTC and SEC jurisdictional split and a similar control based test, and CLARITY is narrower in scope than the regime FIT21 proposed. The firm's reading is that they are two attempts at one problem rather than two drafts of one bill.

What the decentralization test is still worth at design time

The factors FIT21 proposed overlap heavily with what Howey's fourth prong already asks: whose continuing work the value depends on, and whether anyone holds unilateral control. That overlap is why the test survives its own bill. Removing unilateral upgrade authority, ending team control of the treasury, and being able to name the event that ended each one are worth doing on their own merits, under the law that exists.

What is not worth doing is architecting a token so that it clears a statutory threshold nobody has enacted. Teams we saw do exactly that around FIT21 in 2024 spent the following year unwinding the assumption. Design against current law, and let a future statute be upside. The mechanics of building that record sit on the security classification defense page.

Where to look instead

For the live legislative position, the CLARITY Act page carries the current status with its dates and sources. For the law as it actually stands, the security versus commodity classification page covers the statutory commodity definition and the case law, and the Howey test page covers the four prong analysis a court applies today.

Whether a specific token or structure would have qualified under FIT21, or qualifies under existing law, is fact specific and jurisdiction specific, and that call belongs to your counsel. This page describes expired legislation. It is not legal advice, and it is not a recommendation to buy, sell, or hold any asset.

Common questions

Did FIT21 become law?

No. H.R. 4763 passed the House by recorded vote on 22 May 2024 and was referred to the Senate Committee on Banking, Housing, and Urban Affairs, but received no Senate vote and expired unenacted when the 118th Congress ended on 3 January 2025.¹ No provision of it is in force. Any current description of FIT21 as US digital asset law is wrong.

What is the difference between FIT21 and the CLARITY Act?

FIT21 was H.R. 4763 in the 118th Congress and is expired. The CLARITY Act is H.R. 3633 in the 119th Congress, narrower in scope, and still pending: it passed the House on 17 July 2025 by 294 to 134 and was reported out of Senate Banking with an amendment on 1 June 2026.²³ They share a CFTC and SEC jurisdictional split and a control based test, but no formal legislative cross reference links them.

Is FIT-21 still relevant to token design?

As a reference point rather than a rule. Its decentralization test asked whether any person or entity holds unilateral authority over the blockchain, which overlaps with what the Howey analysis asks about reliance on the efforts of others.¹ Removing unilateral upgrade and treasury control is defensible under current law on its own. Designing to clear an unenacted statutory threshold is not.

See Token Classification Strategy Guide for how this applies in practice.

Sources

H.R. 4763, Financial Innovation and Technology for the 21st Century Act, 118th Congress
U.S. Government Publishing Office, GovInfo, 2023
Bill text and record. Purpose clause, the certified as decentralized test and the unilateral authority standard, House passage 22 May 2024, Senate Banking referral, expiry unenacted at the end of the 118th Congress on 3 January 2025.
H.R. 3633 (119th Congress) legislative history, all actions
Congress.gov, Library of Congress, 2026
Successor bill status: House passage 17 July 2025, Senate referral 18 September 2025, reported with amendment 1 June 2026. The congress.gov host rejects automated clients; the page is live.
Congressional Record, 17 July 2025, page H3449, passage of H.R. 3633
U.S. Government Publishing Office, GovInfo, 2025
Official record of the CLARITY Act House vote: yeas 294, nays 134, not voting 4, Roll No. 199.

Last reviewed 2026-08

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