Can US lawmakers pass crypto market structure before the midterms?

While US Senate lawmakers have been working to pass a comprehensive digital asset market structure bill since July, some industry observers in Washington say progress could be “on hold” due to government gridlock.

Since the House of Representatives passed the CLARITY Act last summer and sent the legislation to the other chamber, lawmakers have faced a historically long government shutdown, partisan divides on ethics and debates over stablecoin yield that have likely slowed progress on the bill, which could be further hampered by the upcoming US midterm elections in November.

Eight months ahead of the midterms, one version of the market structure bill focused on commodities regulations has passed the Senate Agriculture Committee, while members of the Senate Banking Committee have yet to address a bill on securities laws and regulations after the panel cancelled a markup in 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.

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“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

Further complicating the matter in the Senate is the debate around stablecoin rewards, which has resulted in a reported three meetings at the White House between Trump officials and representatives from the crypto and banking industries. Some in banking have argued that having the market structure bill include provisions allowing yield payments to stablecoin holders on third-party platforms could undermine the industry.

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.

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