US senators met on Tuesday to resume talks on the cryptocurrency bill that will establish the structure of the digital assets market, according to people familiar with the situation, although no further agreements have been announced on the various talking points between Democratic and Republican negotiators.
One of those gathered today, Senator John Kennedy, told Punchbowl News that Senate Banking Committee Chairman Tim Scott was planning an increase to the bill next week, on January 15. The committee would likely have to release an updated bill before the increase, but the latest draft was shared months ago.
After months of back-and-forth that failed to reach a finished product in last year’s session of Congress, the process begins again by 2026, although lawmakers face a constrained and politically perilous timeline. Members of the Senate have been arguing over President Donald Trump’s actions in Venezuela, and have a few weeks to meet a Jan. 30 deadline for a federal spending plan that can prevent another government shutdown, but cryptocurrencies remain in the mix as another congressional priority.
If Scott pushes for an increase next week, it could avoid some of the budget tension, but it is not likely to be a bipartisan effort unless senators can very quickly resolve several outstanding points that Democrats have been pressing. Democrats, some of whom participated in Tuesday’s meeting, according to people familiar with the matter, have pushed for ethical standards to be included in the cryptocurrency bill to prohibit top government officials from profiting from digital asset activity, as President Donald Trump has done. They are also seeking restrictions on decentralized finance (DeFi) platforms and limits on cryptocurrency performance that could allow the industry to compete head-to-head with banks.
These are all sensitive issues and potential obstacles to industry support for the legislation, although members of both parties have said they are motivated to reach an agreement and pass the legislation. If Kennedy’s suggested schedule for next week holds true, it could force Democratic negotiators to oppose whatever is voted on unless common ground has been reached.
Trump’s cryptocurrency czar, David Sacks, had similarly suggested last month in a post on the social media site
Several sources of pressure are combining to increase the urgency of crypto action in the Senate. The House of Representatives long ago passed its own Digital Asset Market Clarity Act to establish US crypto regulation, so that chamber is waiting for the Senate. And a Jan. 30 deadline looms to establish a federal spending plan or risk a shutdown like the record 43 days a few months ago. Additionally, midterm legislative elections will be held this year, adding more political pressure and calendar constraints.
On Tuesday, the banking industry again reiterated its strong interest in using this bill to repeat last year’s Guidance and Establishment of National Innovation for US Stablecoins (GENIUS) Act to prevent crypto affiliates from paying yield for stablecoins. It has been a months-long lobbying battle between the two industries, and the legislation produced by the Senate negotiations may determine which sector emerges victorious.
Read more: What if the US cryptocurrency market structure effort never comes to an end?
