The Crypto Bill That Was Supposed to Change Everything Is Stuck and the Reasons Why Tell You a Lot

Congress was supposed to have passed the most significant piece of crypto legislation in American history by now. That was the plan. White House crypto adviser David Sacks said in December that they were “closer than ever” and Senate hearings were expected in January. The House passed its version last summer. The whole thing had momentum and bipartisan energy and the kind of Washington consensus that almost never happens around anything involving money and technology at the same time.

It’s March and the bill is stuck in the Senate. And the reasons it’s stuck are more interesting than the bill itself.

The legislation is called the Clarity Act and what it’s trying to do is actually pretty straightforward. Right now nobody in Washington can agree on which federal agency is supposed to regulate crypto. The SEC says it’s securities. The CFTC says it’s commodities. During the Biden administration both agencies basically tried to claim the whole space and the result was regulation by enforcement. No rules. Just lawsuits. The Clarity Act would draw a line. Some tokens go to the SEC. Some go to the CFTC. Everyone knows where they stand. JPMorgan put out a note a few days ago saying if this passes by midyear it could be the catalyst that turns crypto markets around. I think that’s probably right. But getting from here to there is where everything falls apart.

The Senate Agriculture Committee advanced its version on January 29. Party line vote. Twelve Republicans yes, eleven Democrats no. First time a crypto market structure bill had ever cleared a Senate committee. Should have been a big moment. It was. But it was also the moment the bipartisan thing died. Senator Cory Booker had been working with Chairman Boozman on a draft for months. They had what looked like a real partnership. Then Booker walked away saying the version that went to vote was different from what they’d agreed to. He also said during the hearing that Trump “is grifting on crypto himself.” That’s the first crack. Democrats don’t trust the process when the president has personal financial interests in the outcome. And honestly I understand why that’s hard to get past.

But the Democratic concerns aren’t the only problem. Coinbase pulled its support too. The largest crypto exchange in the country looked at the Senate Banking Committee’s version and said no. Their CEO Brian Armstrong said draft amendments would kill rewards on stablecoins and let banks ban their competition. The Banking Committee had to postpone its markup at the last minute and that hearing still hasn’t been rescheduled.

Here’s the part I find genuinely fascinating. The crypto industry spent years begging for regulation. Years. Now that it’s actually coming they can’t agree on what it should look like. The stablecoin yield fight is a perfect example. Banks see crypto yield products as a direct threat to their deposit base. If crypto companies can effectively pay people interest on stablecoins then why would anyone keep money in a savings account earning less? The White House brought banking and crypto executives into the same room in early February to work it out. Gave them a deadline. From what I can gather the meeting didn’t go great.

What I keep thinking about is the timing. Midterms are in November. If Republicans lose their majority in either chamber the entire dynamic changes. The crypto industry’s golden age in Washington is basically the product of a narrow Republican majority and that could end in eight months. That should be creating urgency to get a deal done. Instead everyone is digging in because they think time is on their side.

The Senate Banking Committee still needs to hold its hearing. Then both committee versions need to merge. Then the full Senate where you need at least seven Democratic votes. Every one of those steps is currently blocked by some combination of partisan distrust, industry infighting, and the stablecoin question nobody can resolve.

The irony is hard to miss. An industry built on decentralization and cutting out middlemen is now completely dependent on a handful of senators and lobbyists to determine its future. And those senators and lobbyists can’t agree on anything right now. I don’t know if the bill passes this year. I think the pieces are there but the people holding them keep dropping them. And every month without a framework is another month where capital stays on the sidelines and the US falls further behind countries that figured out how to regulate this without turning it into a partisan knife fight.

Works Cited

1. JPMorgan analysts, via CoinDesk. “Bitcoin Is Stuck in a Rut but JPMorgan Says New Legislation Could Be the Ultimate Spark.” February 28, 2026. coindesk.com