Passing legislation on crypto markets in the United States is becoming as volatile as the crypto markets themselves.
Thursday (January 15) was supposed to be a big day for the digital assets sector. The Senate Banking Committee, which oversees the Securities and Exchange Commission (SEC), and the Senate Agriculture Committee, which oversees the Commodity Futures Trading Commission (CFTC), have set the date for a synchronized markup on two variations of a bill regulating crypto markets in the United States.
This ultimately did not happen.
As of Wednesday evening (January 14), the crypto industry’s legislative momentum had lost steam due to a variety of unresolved issues, raised by both financial services industry groups and crypto groups. First, the Agriculture Committee postponed their increase until the end of the month. Then the Senate Banking Committee did the same.
The immediate cause was the announcement by US-listed cryptocurrency exchange Coinbase that it “cannot support the bill as written.”
In a statement posted to social media platform
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The statement led to a rapid procedural pushback, with lawmakers on the other side signaling that the text would require renegotiation or risk further delays.
Yet other companies, including Robinhood CEO Vlad Tenev, have reaffirmed their support for the underlying market structure bill, even though the markup has been delayed.
“The White House remains committed to working with Chairman Scott, members of the Senate Banking Committee, and industry stakeholders to pass bipartisan crypto market structure legislation as soon as possible,” said David Sacks, the White House AI and crypto czar, also on X.
For policymakers, the result represents a classic Washington dynamic: the louder the chorus of stakeholders, the harder it becomes to discern a policy position. In this case, industry opposition to specific provisions was enough to block what observers hoped would be a landmark policy regulating digital asset markets and building on the momentum of the stablecoin-focused GENIUS Act, which was signed into law over the summer.
Learn more: Senate Sets Dueling Markups for High-Stakes Crypto Market Regulation
Why Washington’s Most Ambitious Crypto Bill Has Stalled
The friction around the crypto bill isn’t just between crypto companies and regulators; it also reflects long-standing tensions between the crypto sector and traditional banking.
Banks are increasingly lobbying against crypto offerings that resemble deposit products, particularly stablecoin rewards that they say compete with regulated interest accounts. This banking pushback has seeped into the legislative text, giving rise to provisions aimed at limiting crypto incentives, which have been a key flashpoint for Coinbase and other developers of stablecoin-based products.
PYMNTS has previously detailed how industry groups such as the American Bankers Association, America’s Credit Unions, Bank Policy Institute, Consumer Bankers Association and others have pressed senators to ban any performance-related incentives tied to stablecoin holdings, regardless of company separation.
They also pressured the Office of the Comptroller of the Currency and the Federal Reserve to issue guidance discouraging banks from partnering with stablecoin programs that engage in near-yield products. The groups noted that Treasury estimates show that $6.6 trillion in deposits could be at risk from such incentives.
The issues go beyond stablecoin performance, which was not addressed in the text of the GENIUS Act. Issues such as decentralized finance (DeFi) oversight, consumer protection safeguards, and infrastructure innovation are all woven into the text of the crypto market bill and the debates surrounding it.
“We spent thousands of hours working in good faith to introduce a bill that provides the digital assets industry the clarity it needs to thrive on American soil and solidify America’s leadership in financial innovation for generations to come. Today’s response from some in the industry proves they simply aren’t ready,” said Sen. Cynthia Lummis, R-Wyo. in a statement. Senator Lummis is the Chairman of the Senate Banking Subcommittee on Digital Assets.
Learn more: Compliance is Crypto’s New Cost of Doing Business
What’s next for crypto market legislation
For lawmakers, this delay is a double-edged sword. On the one hand, it saves time to refine the text and potentially gain wider support; on the other hand, it risks losing momentum as midterm election pressures intensify and legislative timetables tighten. Past attempts to rally bipartisan support on crypto regulation have often failed in precisely this way, with early enthusiastic progress followed by a slowdown as stakeholders push back on details.
In practical terms, the current delay likely means that any version of the bill that comes up for a vote in the Senate will be significantly different from the text that Coinbase and others opposed this month. Amendments regarding stablecoin incentives, tokenized assets and application limits will be priorities for review. It remains to be seen whether these adjustments will satisfy both industry heavyweights and skeptical lawmakers.
Fundamentally, the current impasse reveals a fundamental truth about crypto regulation: clarity is not the same as consensus. Policymakers, industry leaders and traditional financial intermediaries all want clear rules. But they differ sharply on what these rules should prioritize.
