Senate Delays Crypto Market Structure Bill to Secure Bipartisan Support

Washington hits pause on digital asset regulation—again.

The Senate Banking Committee just punted the long-awaited crypto market structure bill, opting to delay the vote rather than force a partisan showdown. Lawmakers claim they're building consensus, but insiders whisper the move reeks of election-year calculus.

Consensus or Can-Kicking?

This isn't the first delay, and it won't be the last. The bill's architects argue that rushing a vote now would guarantee failure. They want more time to wrangle votes from the skeptical middle—those who still think 'blockchain' is a type of gym equipment.

Meanwhile, the industry fumes. Startups operating in regulatory purgatory face another quarter of uncertainty. The delay tells every crypto CEO the same old story: don't expect clarity before the next political cycle.

The Real Sticking Points

Forget the high-minded talk about innovation. The holdup boils down to turf wars and definitions. Who regulates what? Is a token a security or a commodity? These questions have multi-billion dollar answers, and no senator wants to be the one who got it wrong.

The delay, while frustrating, might be the smart play. A rushed, flawed bill could do more damage than no bill at all—creating loopholes big enough to drive a digital truck through, or worse, cementing the SEC's controversial enforcement-by-lawsuit approach.

What Happens Now?

Markets barely blinked. Traders have grown accustomed to regulatory theater. The real action isn't in D.C. hearing rooms; it's on-chain, where protocols evolve faster than any committee can draft legislation.

This postponement isn't a death knell—it's a tactical retreat. The bill's supporters haven't given up; they're regrouping. Expect backroom deals, amended drafts, and plenty of political posturing before this sees the light of day again.

In the end, the Senate's 'strategic delay' reveals a timeless truth: when it comes to regulating money, politicians move at the speed of molasses—unless there's a banking crisis or donor pressure. For now, the crypto wild west gets a temporary reprieve, proving once again that in finance, uncertainty is the only certain bet.

Banks Challenge Stablecoin Yield Provisions in Final Negotiations

Traditional banking groups intensified lobbying efforts to restrict stablecoin rewards beyond the GENIUS Act’s framework, which permits third-party platforms to offer incentives while barring direct interest payments from issuers.

The latest Senate Banking Committee draft, released late Monday after what sources described as a “” of a day, prohibits companies from paying interest solely for holding balances but allows rewards tied to account opening, transaction activity, staking, liquidity provision, collateral deposits, or governance participation.

NEW: The Senate Banking Committee is aiming to file its latest (still) bipartisan market structure text before midnight after what’s been described to me as a “doozy” of a day, full of intense heartburn from both sides over stablecoin yield, now emerging as THE thorniest issue…

The American Bankers Association warned in a recent letter that “if billions are displaced from community bank lending, small businesses, farmers, students, and home buyers in towns like ours will suffer,” arguing that crypto exchanges cannot replicate FDIC-insured products or fill lending gaps from deposit outflows.

As a result, Coinbase threatened to withdraw support if Senate negotiators insert restrictions beyond enhanced disclosure requirements, with Chief Policy Officer Faryar Shirzad contending that “undermining the supremacy of the USD has been a longstanding goal of the PRC—the Senate banning rewards WOULD be a big assist to China’s efforts,” noting Beijing announced plans to pay interest on its digital yuan starting January 1, 2026.

Stablecoin rewards represent critical revenue for Coinbase, which shares interest income from USDC reserves with Circle Internet Group and offers 3.5% yields on Coinbase One balances, with Bloomberg projecting the exchange’s total stablecoin revenue reached $1.3 billion in 2025.

Jake Chervinsky of Variant Fund questioned the yield restrictions, stating, “there are a few things left that could blow up the market structure bill, and stablecoin yield is one of them,” adding, “what does stablecoin yield have to do with market structure, you ask? Good question! NOTHING. Except the banks have influence and they want their regulatory moat back.“

There are a few things left that could blow up the market structure bill, and stablecoin yield is one of them.

What does stablecoin yield have to do with market structure, you ask? Good question! NOTHING.

Except the banks have influence and they want their regulatory moat back. https://t.co/Ruz8RFk1Xj

Legislative Timeline Faces Midterm Election Pressure

Three Democratic senators, Chris Van Hollen, Tina Smith, and Jack Reed, sent a letter to Banking Committee leadership demanding a full hearing before Thursday’s markup, criticizing the lack of text “just two days before the markup, calling the timeline inadequate for voting on ‘the most significant law considered by the committee this century.’“

The lawmakers noted that neither the full committee nor the public had seen any text resembling the legislation affecting 68 million American crypto owners and the $3 trillion digital asset market by 6 p.m. Monday, ahead of the 10 a.m. Thursday vote.

NEW: Late night plea from Democratic Senators on the Banking Committee for a full hearing ahead of Thursday’s markup.

Sens. @ChrisVanHollen, @TinaSmithMN, and @SenJackReed sent a letter to @BankingGOP leadership criticizing the lack of text (expected to be well over 200 pages)… pic.twitter.com/LNbYsTZVqY

Due to growing bipartisan opposition and pressure from bankers, TD Cowen warned that the 2026 midterms could delay passage until 2027, with Senate Democrats potentially withholding support as lawmakers position for the next cycle.

Bloomberg Intelligence analyst Nathan Dean even suggested the markup’s lack of bipartisan support may push odds of first-half passage below 70%, while full implementation could extend to 2029 depending on election outcomes that reshape congressional control.

Notably, the new legislation includes an “” automatically classifying tokens as non-securities if they were principal assets of exchange-traded products listed on national securities exchanges as of January 1, treating major altcoins identically toandfrom day one.

Bill Hughes of Consensys also noted the bill “really does protect non-custodial trading interfaces” by creating regulatory perimeters based on custody and control rather than interface popularity, stating “if users trade through their own keys, you’re software” versus “if users trade through their own keys, you’re software.“

The new Senate Banking draft of market structure just was published and here is where ChatGPT says it draws the regulatory perimeter when it comes to self custody interfaces (This is quick – a deep dive is required):

This is the crux of this bill — and the answer is yes, it…

SEC Chair Paul Atkins expressed full support for congressional action, writing, “passing bipartisan market structure legislation will help us future-proof against rogue regulators, ensuring that we achieve President Trump’s goal to make the U.S. the crypto capital of the world,” while anticipating the president would sign legislation “in the coming months.“