Will Congress Approve Crypto Market Structure Legislation Prior to Midterm Elections?
Despite the White House organizing three separate meetings focused on resolving stablecoin yield issues within the Senate's proposed market structure legislation, no breakthrough has emerged.
Despite efforts by US Senate legislators to advance comprehensive digital asset market structure legislation dating back to July, Washington-based industry watchers suggest that momentum may have stalled amid governmental gridlock and political complications.
Following the House of Representatives' approval of the CLARITY Act during last summer and its subsequent transmission to the Senate, legislators have encountered numerous obstacles including an unprecedented government shutdown, partisan disagreements surrounding ethics issues, and contentious discussions regarding stablecoin yield provisions. These challenges have potentially delayed advancement of the proposed legislation, with additional complications expected from the approaching US midterm elections scheduled for November.
With eight months remaining before voters head to the polls in the midterm contests, one iteration of the market structure legislation concentrating on commodities oversight has successfully cleared the Senate Agriculture Committee. Meanwhile, Senate Banking Committee members have not yet taken up companion legislation addressing securities laws and regulatory frameworks following the panel's decision to cancel a markup session scheduled for January.
Rebecca Liao, co-founder and CEO at Web3 and AI protocol Saga and a former adviser to then-US President Joe Biden during his 2020 campaign, told Cointelegraph last week that the legislation was effectively "on hold." She also pushed back against comments by Ohio Senator Bernie Moreno, who said in February that Congress could pass market structure "hopefully by April," citing a lack of steam for advancing the bill.
"Earlier, when crypto markets were doing very well, when it seemed that every TradFi institution was coming up with a crypto strategy, looking to load up on the main assets, there was a lot more urgency around any sort of new legislation or new administrative policy coming out of the SEC, CFTC, etc," said Liao.
"But now that the markets have cooled significantly, and even people within crypto are saying 'we don't know, honestly, if the Trump family ended up being a good thing for crypto or not' a lot of the wind has been taken out of the sails."
She added:
"It is not easy to get any sort of legislation through this Congress, and when it's on a topic that most Americans honestly still find pretty obscure, it's even harder. And it's an election year."
Stablecoin debate rages, with the Trump administration in the middle
Adding another layer of complexity to the Senate's deliberations is the ongoing controversy surrounding stablecoin rewards, which has prompted three separate White House meetings bringing together Trump administration officials with stakeholders from both the cryptocurrency sector and traditional banking institutions. Traditional banking representatives have voiced concerns that incorporating provisions within the market structure bill that would permit yield payments to stablecoin holders through third-party platforms might threaten the stability of the conventional banking sector.
Crypto advocacy organization Digital Chamber CEO Cody Carbone spoke to Cointelegraph after attending the World Liberty Financial forum during which Moreno laid out his timeline on the bill. The trade group leader said the mood among some at the event, such as Coinbase CEO Brian Armstrong, was "very optimistic" on finding resolutions to move the bill forward, but outside of Moreno's April goal, "there wasn't a lot of specifics."
The 2026 election season has already kicked off in some US states, with party primaries scheduled for Tuesday in Arkansas, North Carolina and Texas ahead of the November general election. The Senate will also likely take about a month away for a state work period in August, returning two months before the election.