US Senate Delays Crypto Market Structure Bill Until 2026

Highlights:

• The Senate Banking Committee has postponed the crypto market structure bill until early 2026.
• Key issues such as SEC vs. CFTC jurisdiction and DeFi oversight caused delays.
• The bill aims to provide regulatory clarity for crypto markets and investors.

The long-awaited crypto market structure bill has been delayed by the US Senate, and now it is expected to be considered in early 2026. Initially, the Senate Banking Committee had planned to hold hearings and advance the bill by the end of 2025. However, prolonged bipartisan negotiations have hindered progress. Senate Banking Committee Chairman Tim Scott announced that the committee will no longer hold a markup hearing this year as originally scheduled.

Reasons Behind the Delay

A number of reasons have led to the delay of the crypto market structure bill. Among the key causes is the absence of an agreement between Senate Republicans and Democrats on key provisions of the bill. A key area of contention has been the jurisdiction of the Securities and Exchange Commission (SEC) as well as the Commodity Futures Trading Commission (CFTC).

The bill seeks to establish the way these two agencies will regulate the crypto market. However, there has been a failure to balance the differences between the two committees that oversee the SEC and the CFTC.

The regulation of decentralized finance (DeFi) has also been another major concern. Certain legislators have advocated exemptions for DeFi protocols, which generally lack a central intermediary. Some are, however, worried that the broad exemptions may undermine enforcement and create gaps in regulations. Consumer protection has been a controversial issue. Several senators are arguing that the bill may jeopardize investor protections, particularly after a series of high-profile crypto failures.

The Impact on the Crypto Industry

The delay of the crypto market structure bill is a blow to many in the crypto industry. The bill was anticipated to bring regulatory clarity to crypto exchanges, issuers, and investors. The bill would specify the application of securities laws to digital assets and make the CFTC the primary regulator of spot crypto markets.

Regardless of the time lost, there is still the hope that the bipartisan talks will result in a strong regulatory framework. According to Chairman Tim Scott, the goal is to establish a clear and unified framework for crypto regulation that would provide the digital asset industry with legal certainty. Moreover, the goal is to establish the United States as a worldwide leader in the crypto arena.

However, the delay increases regulatory uncertainty, which has been a significant issue with the crypto industry. The bill remains stalled, and market participants are unsure about how the federal agencies will oversee the fast-growing market of digital assets.

Amidst this delay, consumer advocacy groups such as the American Federation of Teachers (AFT) recently expressed their opposition to the bill. The AFT, an organization representing 1.8 million members, urged the US Senate to withdraw the bill. They warned that it would compromise the economic stability of the pension and retirement funds.