In brief
- Lawmakers said talks were continuing with industry, regulators and law enforcement, despite the delay.
- Coinbase and other industry voices have pulled back support, warning the draft could create new uncertainty for developers and user access.
- Critics argue provisions expanding enforcement powers and transaction controls could undermine consumer trust in digital-asset markets.
The Senate Banking Committee has delayed markup of a bipartisan crypto market structure bill, adding to earlier postponements by the Agriculture Committee and extending uncertainty around the legislation’s timeline.
Announced late Wednesday, Senate Banking Committee Chair Tim Scott issued a statement saying he had spoken with leaders across the crypto industry, the financial sector, and both parties in Congress, reaffirming that negotiations were continuing in “good faith.”
The bill aims to define regulatory jurisdiction for crypto between the Securities and Exchange Commission and the Commodity Futures Trading Commission, as well as establish a federal framework for overseeing digital-asset markets.
If enacted, it would be the first comprehensive federal statute codifying crypto market structure, replacing reliance on regulatory guidance and litigation. It would also materially reshape compliance obligations for exchanges, stablecoin issuers, and DeFi platforms.
The lead-up to this point follows “months of serious bipartisan negotiations and real input from innovators, investors, and law enforcement,” Scott said.
Those efforts, he added, were being made “to deliver clear rules of the road that protect consumers, strengthen our national security, and ensure the future of finance is built in the U.S.”
The Banking Committee’s move follows an earlier decision by the Senate Agriculture Committee to delay its own markup until late January, after that panel said it needed more time to review the legislation before proceeding.
The bill falls under the jurisdiction of both committees because it divides oversight of crypto markets between the SEC, which reports to the Banking Committee, and the CFTC, which is overseen by the Agriculture Committee.
Together, the overlapping delays mean the bill cannot advance until both complete their respective markups, extending the process beyond the timeline lawmakers initially signaled.
Still, the delays could create “real room to tighten these provisions, because consumer protection depends on due process and narrow, clearly defined triggers, not broad discretion to interrupt access to funds,” Jonathan Inglis, CEO of crypto-focused consumer research firm Protocol Theory, told Decrypt.
Should it eventually pass, the bill could also prove a major boon not only for Bitcoin but for the broader crypto market.
Gerry O’Shea, head of global market insights at crypto asset manager Hashdex, told Decrypt that the passage of the bill could be a major development for altcoins, which had faced scrutiny under the SEC’s previous leadership.
“That’s probably, in my opinion, at least the biggest catalyst for altcoins this year,” O’Shea said of the bill. “Still, I’m only giving it about a 60% chance of passing at this point.”
Industry ire
The delays also follow industry pushback drawn from a range of issues.
On Wednesday, Coinbase withdrew its support for the bill ahead of the Senate’s previously expected vote, citing unresolved concerns over how parts of the legislation could affect developers and user access.
Coinbase argues the framework, as written, risked creating uncertainty around software activity and could undermine the consumer protections lawmakers intended to deliver.
Concerns over how the bill would expand enforcement and surveillance authority have also moved into focus.
Earlier this week, Galaxy Research warned that parts of the draft could significantly expand financial monitoring powers, drawing a comparison to the PATRIOT Act’s post-9/11 expansion of surveillance authorities.
As currently written, the 278-page draft “expands practical enforcement power by pulling more of the user-facing crypto experience into scope, especially the interfaces people actually use day to day,” Inglis said.
“Consumers adopt digital money for speed and clarity, so any framework that widens monitoring and control at the access layer has real trust consequences,” Inglis said.
What’s glaring in the current draft is “the move toward rapid transaction interruption, including freezes requested without a court order, backed by liability protection for firms that comply,” he said. “For consumers, the harm is the same whether friction comes from legacy delays or a mistaken hold.”
Up to 67% of U.S. consumers report delayed access as a “major frustration,” Inglis said.
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Source: https://decrypt.co/354696/senate-delays-markup-crypto-market-structure-bill
