By Hannah Lang
Jan 13 (Reuters) – U.S. senators on Monday evening unveiled a bill that would create a regulatory framework for cryptocurrencies that, if signed into law, would clarify financial regulators’ jurisdiction over the booming sector, potentially boosting adoption of digital assets.
The crypto industry has long lobbied for such legislation, often arguing that it is existential to the future of digital assets in the United States and necessary to solve fundamental and long-standing problems for crypto companies.
Among other things, the legislation would define when crypto tokens are securities, commodities or otherwise, giving the industry much-hoped for legal clarity.
It would also give the US Commodity Futures Trading Commission – the industry’s preferred regulator, as opposed to the US Securities and Exchange Commission – the power to police crypto spot markets.
The banking industry is seeking fixes to the 2025 crypto legislation that created a federal regulatory framework for dollar-pegged crypto tokens called stablecoins.
At the time, bank lobbyists urged Congress to close what they saw as a loophole in the bill that allowed intermediaries to pay interest on stablecoins. Banks argued that this would lead to a flight of deposits from the insured banking system, potentially threatening financial stability.
“Trillions of dollars could be diverted from community financial institutions, weakening the financial fabric of cities and neighborhoods nationwide,” the American Bankers Association, the nation’s largest lobbying group, and other financial trade groups warned in a letter to Congress on Monday.
Crypto companies objected to the claim, saying that prohibiting third parties – such as crypto exchanges – from paying interest on stablecoins would be anti-competitive.
Trump courted industry money by pledging to be a “crypto president,” and his family’s own crypto businesses helped propel the sector into the mainstream.
The crypto industry has spent a lot of money in the 2024 elections promoting pro-crypto candidates in hopes of passing this landmark market structure bill.
The House of Representatives passed its version of the bill in July, but discussions stalled in the Senate last year, with lawmakers divided over anti-money laundering provisions and requirements for decentralized finance platforms, which allow “cryptocurrency users to buy and sell tokens without an intermediary,” according to three sources familiar with the discussions.
With Congress already focused on the 2026 midterm elections, in which Democrats could take over the House, some lobbyists are skeptical that the crypto market structure bill could become law.
