Key Points
- The Senate Agriculture Committee advanced a crypto regulation bill on a party-line vote.
- The legislation would give the CFTC authority to oversee spot crypto markets.
- Democrats opposed the bill, asking for stricter rules on political profits and decentralized finance.
- A separate dispute over stablecoin interest rates is stalling progress in the Banking Committee.
The U.S. Senate Agriculture Committee took a major step toward regulating the cryptocurrency industry on Thursday, advancing a new bill that would set clear rules for digital assets. However, the legislation moved forward on a strictly party-line vote, signaling that it faces a difficult road ahead in the full Senate, where Democratic support is essential.
If this bill becomes law, it would hand significant power to the Commodity Futures Trading Commission (CFTC). This agency would become the primary watchdog for “spot” crypto markets, meaning the places where people buy and sell actual digital coins. It would also create a rulebook for exchanges, brokers, and dealers, giving the industry the legal clarity it has been demanding for years.
Crypto companies spent heavily during the 2024 elections to support candidates who favor these kinds of regulations. They argue that without a clear framework, the industry cannot grow safely in the United States. The House of Representatives already passed its version of the bill back in July, putting pressure on the Senate to act.
However, the path to President Trump’s desk is blocked by political disagreements. To pass the full Senate, the bill needs at least seven Democrats to break ranks and vote for it. So far, that support isn’t there.
Senator Cory Booker, the top Democrat on the committee, voted against the measure. He expressed frustration, using a football analogy to say they are “almost in the red zone” but haven’t found a bipartisan way to score yet. Democrats are pushing for stricter rules, including bans on political officials profiting from crypto and tighter controls on decentralized finance.
There is also a separate battle brewing in the Senate Banking Committee. Banks and crypto firms are fighting over “stablecoins,” which are tokens pegged to the U.S. dollar. Banks are lobbying hard to stop crypto companies from paying interest on these tokens, seeing it as a threat to traditional savings accounts.
To try and break the deadlock, the White House plans to meet with executives from both the banking and cryptocurrency industries on Monday.
