Bitcoin Magazine

Senate Democrats, Crypto Industry to Resume Talks After Market Structure Bill Delay

U.S. Senate Democrats are reportedly set to reopen talks with representatives from the cryptocurrency industry on Friday, according to people familiar with the plan speaking to CoinDesk. 

All this comes less than two days after a last-minute postponement of a key Senate Banking Committee hearing on sweeping digital asset legislation.

The call follows Wednesday night’s abrupt cancellation of the committee’s planned markup of the long-negotiated crypto market structure bill, which had been expected to divide regulatory oversight of digital assets between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). 

The delay came after Coinbase, the largest U.S.-based crypto exchange, withdrew its support for the draft legislation, citing concerns over stablecoin rewards programs and what it viewed as excessive authority granted to the SEC.

Coinbase CEO, Brian Armstrong, said that banks are trying to “kill their competition” with the crypto market structure legislation. “Crypto companies should be allowed to compete and offer loans just like banks,” Armstrong said.

Thursday marked a pause in public activity after the cancellation, but lawmakers and industry participants say negotiations are far from over. 

Democrats from both the Senate Banking Committee and the Senate Agriculture Committee — which oversees the CFTC — are expected to join Friday’s call, along with representatives from crypto policy advocacy groups in Washington, according to reports. 

The Banking Committee had been scheduled to hold an all-day session Thursday to debate amendments and vote on whether to advance the bill. 

That plan unraveled late Wednesday after Coinbase CEO Brian Armstrong said the company could not support the current version of the legislation. Shortly thereafter, Senate Banking Committee Chair Tim Scott, R-S.C., postponed the hearing.

Lummis: Senate is closer than ever

Despite the setback, several lawmakers involved in the negotiations said discussions will continue. In a post on X, Sen. Cynthia Lummis, R-Wyo., a leading crypto advocate in the Senate, said lawmakers were “closer than ever” to reaching agreement.

“Everyone is still at the negotiating table, and I look forward to partnering with [Chairman Scott] to deliver a bipartisan bill the industry — and America — can be proud of,” Lummis wrote Thursday.

Sen. Bill Hagerty, R-Tenn., echoed that optimism, saying he remained “confident” that lawmakers could reach a consensus “in short order.”

“I am fully committed to continuing this important work with my colleagues on market structure and look forward to passing legislation that ensures this innovative technology flourishes in the United States for decades to come,” Hagerty said.

Industry reaction to Coinbase’s withdrawal has been mixed. While Armstrong’s comments intensified scrutiny of the bill, other crypto executives and advocacy groups urged lawmakers to keep pushing forward.

Kraken co-CEO Arjun Sethi said abandoning negotiations now would worsen regulatory uncertainty for U.S. crypto firms. “Walking away now would not preserve the status quo in practice,” Sethi said in a post on X. “It would lock in uncertainty while the rest of the world moves forward.”

A major point of contention in recent negotiations has been whether stablecoin issuers should be permitted to offer rewards or yield programs — an issue that has drawn pushback from bank lobbyists and some Democrats concerned about consumer protection and competition with traditional deposits.

While the Banking Committee’s markup has been postponed, the Senate Agriculture Committee is still expected to hold a hearing on the legislation on January 27, after previously pushing back its own earlier session. Ultimately, both committees’ work would need to be merged before the bill could advance to the full Senate.

Some analysts see the delay as a strategic pause, with Benchmark’s Mark Palmer saying it could help lawmakers build broader bipartisan support and ultimately strengthen what he called a potentially historic overhaul of U.S. financial regulation. 

Others are more doubtful: TD Cowen warned that bridging Democratic demands and Coinbase’s objections may be difficult, especially since some disputed provisions were already concessions to Democrats, while election-year timing and the Senate’s 60-vote threshold add further hurdles. 

This post Senate Democrats, Crypto Industry to Resume Talks After Market Structure Bill Delay first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

A planned Senate Banking Committee legislation markup has been postponed, as Coinbase CEO Brian Armstrong has withdrawn his support for a market structure bill which seeks to codify federal regulations over crypto, stablecoins, and DeFi markets.

Based on reports, this unexpected withdrawal sharpened existing tensions between senators on debates of this bill and lawmakers who were trying to revamp critical phrases.

Republicans’ Concerns In Oversight

The Republicans in the Senate, under the leadership of Sen. Tim Scott, have strongly countered. They have expressed reservations about whether it is intended to help ordinary investors or just a few companies.

While some representatives expressed their concerns that broad oversight authority could stymie growth in addition to proposed net yields for stablecoins, reports have indicated that Republicans want more defined enforcement authority in opposition to broad regulatory language.

Crypto builders need clear rules of the road.

Over the past five years, Republicans, Democrats, and the Trump Administration have worked closely with members across the crypto industry to protect decentralization, support developers, and give entrepreneurs a fair shot.

​At its…

— Chris Dixon (@cdixon) January 15, 2026

Bitcoin Unfazed By The Standoff

Despite the confusion, crypto prices remained firm. Bitcoin held its ground and climbed 1.5%. The top crypto asset retained its grip on the $96,000 level, while other top cryptocurrencies like Ethereum and USDT likewise notched similar gains in the last 24 hours, based on the latest market tracking figures.

Meanwhile, investors followed speeches and congress sessions. Market volatility heightened. Some investors opted to go to the sideline position as lobbyists and exchanges sought to shape the draft that will come next.

After reviewing the Senate Banking draft text over the last 48hrs, Coinbase unfortunately can’t support the bill as written.

There are too many issues, including:

– A defacto ban on tokenized equities – DeFi prohibitions, giving the government unlimited access to your financial…

— Brian Armstrong (@brian_armstrong) January 14, 2026

As a response to the new draft bill issued by the Senate, several industry representatives vocally objected to its provisions and expressed their belief that it could have a negative impact on tokenized equities and Decentralized Finance.

In fact, there are enough concerns in the blockchain sector raised by Armstrong, that he stated he would prefer to see no bill than see a bad bill passed, indicating that even some members of his industry agree with Republican concerns regarding possible overreach by Congress.

These industry groups said they will likely withdraw their support unless the Senate makes the necessary changes to allow for continued innovation and cross-border competition regarding blockchain technology.

Negotiations Continue To Take Place Behind Closed Doors

Some Senate leaders still want to move toward a committee vote, even though disagreement remains deep. Republican and Democratic legislators are currently negotiating or trading potential amendments on issues such as stablecoin legislation, DeFi protections and investor protections in an effort to reach an agreement on an acceptable version of the bill by both parties.

Democrats have identified a need to address regulatory issues regarding ethics, potential Money Laundering, and DeFi over-regulation as top priorities. On the other side of the aisle, the Republican Party continues to push for legislation that clearly defines the guardrails for federal regulators regarding blockchains.

As a result of ongoing negotiations, there is currently no set timeline for a Senate floor vote on the new legislation.

Featured image from Unsplash, chart from TradingView

Bitcoin Magazine

Senate Banking Committee Postpones CLARITY Act Markup After Crypto Industry Backlash

The Senate Banking Committee postponed its planned markup of the Digital Asset Market CLARITY Act, capping what had been expected to be a pivotal week for U.S. crypto policy with an anticlimactic halt amid growing industry opposition and unresolved political disputes, according to reporting from Crypto in America. 

The decision came after tensions escalated throughout the week as crypto companies and trade groups voiced frustration over late-stage amendments to the 278-page market structure bill. 

Critics argued the changes tilted the legislation further in favor of banks and traditional finance, particularly by tightening restrictions around stablecoin rewards and tokenization.

Compounding the uncertainty, Democrats on the committee continued to press for stronger ethics provisions that would bar senior government officials — including the president — from personally profiting from crypto ventures. Those provisions have repeatedly stalled in negotiations with the White House, contributing to the impasse.

NEW: US Senate Banking Committee postpones Bitcoin and crypto market structure legislation markup after Coinbase and others withdrew their support for the bill pic.twitter.com/XEQT7p2geR

— Bitcoin Magazine (@BitcoinMagazine) January 15, 2026

The immediate catalyst for the CLARITY Act postponement arrived around 4:00 p.m. Jan. 14, when Coinbase CEO Brian Armstrong announced that the exchange was withdrawing its support for the bill. Coinbase had been one of the most influential industry backers of a comprehensive market structure framework, investing heavily in lobbying efforts on Capitol Hill.

“We appreciate all the hard work by members of the Senate to reach a bipartisan outcome, but this version would be materially worse than the current status quo,” Armstrong wrote in a post on X. “We’d rather have no bill than a bad bill.”

In a follow-up post, Armstrong said he remained optimistic that lawmakers could still reach an acceptable compromise and pledged that Coinbase would continue engaging with policymakers on the CLARITY Act.

The withdrawal was a major setback. The loss of support from one of crypto’s most prominent policy voices risked signaling to undecided senators that the bill lacked sufficient industry consensus, raising the likelihood the committee would delay or abandon the markup altogether.

While the markup was ultimately postponed, Coinbase’s decision did not trigger a complete industry retreat. Several major firms and advocacy groups — including a16z, Circle, Paradigm, Kraken, Ripple, Coin Center, and the Digital Chamber — publicly reaffirmed their support for moving forward with a markup.

“It is easy to walk away when a process gets difficult,” Kraken co-CEO Arjun Sethi said in a post on X. “What is hard and what actually matters is continuing to show up, working through disagreements, and building consensus in a system designed to require it.”

In a brief statement announcing the postponement, Senate Banking Committee Chairman Tim Scott (R-SC) said that “everyone remains at the table working in good faith,” but he did not offer a new date for the markup or specify which issues would need to be resolved before it could be rescheduled.

The Senate is out of session next week for the Martin Luther King Jr. Day recess and is set to return the following week.

The Senate Agriculture Committee, which shares jurisdiction over parts of the bill — particularly spot market oversight and the Commodity Futures Trading Commission’s role — is expected to hold its own markup on the CLARITY Act later this month after postponing an earlier session. 

It remains unclear whether Banking’s delay will affect Agriculture’s timeline.

What is the CLARITY Act? 

The CLARITY Act, which uses House-passed H.R. 3633 as its base text, is designed to establish a comprehensive federal framework for digital asset markets. 

The legislation seeks to divide oversight between the Securities and Exchange Commission and the CFTC, set standards for payment stablecoins, clarify rules for decentralized finance, and protect software developers who do not control customer funds.

Supporters, primarily Republicans, argue the bill would replace regulatory uncertainty with clear rules, strengthen anti-fraud and illicit finance authorities, and bring crypto activity back onshore. Committee fact sheets describe it as the “strongest illicit finance framework Congress has ever considered” for digital assets.

Critics, however, contend the bill weakens investor protections and risks creating new loopholes. 

Former SEC Chief Accountant Lynn Turner warned earlier this week that the CLARITY Act draft lacks Sarbanes – Oxley–level safeguards, such as mandatory audited financial statements, internal control certifications, and robust Public Company Accounting Oversight Board oversight — deficiencies he said could enable another FTX-style collapse.

Stablecoin rewards have emerged as one of the most contentious issues in the CLARITY Act. Banking groups argue that yield-bearing stablecoins could siphon deposits from traditional banks, while crypto firms counter that broad bans on rewards would stifle innovation and push users toward offshore platforms.

This post Senate Banking Committee Postpones CLARITY Act Markup After Crypto Industry Backlash first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

Bitcoin Magazine

Ahead of Banking Committee Markup, Senate Republicans Release CLARITY Act Fact Sheets

After months of legislative negotiation and industry scrutiny, the Digital Asset Market CLARITY Act is moving toward a critical juncture on Capitol Hill this week as Senate committees align timelines and prepare some key markups that could finally break the deadlock on U.S. crypto regulation. 

The Senate Banking Committee released an amended draft of the CLARITY Act ahead of a scheduled markup and amendment debate, while the Senate Agriculture Committee set its own markup for late January.

Earlier today, Senate Republicans on the Banking, Housing, and Urban Affairs Committee released a series of fact sheets this week detailing the Act. The Senate’s Banking Committee markup is still scheduled for January 15. 

The materials, published ahead of the committee’s markup today, frame the legislation as a comprehensive attempt to bring digital asset markets under a clear federal framework while strengthening investor protections and addressing illicit finance.

Lawmakers backing the bill argue the absence of statutory clarity has pushed activity offshore and left both investors and national security exposed.

Republicans tout consumer protection, security, and clarity in the CLARITY Act

According to the fact sheets, the CLARITY Act would establish enforceable rules distinguishing which digital assets fall under securities law and which qualify as commodities, formally dividing oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission. 

One section emphasizes consumer protection, stating the bill strengthens disclosure requirements, preserves existing anti-fraud authorities, and limits insider abuse. Digital asset issuers subject to the framework would remain bound by resale restrictions and anti-evasion rules, while fraud would continue to be illegal and fully enforceable by regulators. 

Another focus of the legislation is national security and illicit finance. The fact sheets claim the CLARITY Act contains the strongest illicit-finance framework Congress has considered for digital assets to date. 

Under the proposal, centralized intermediaries would be subject to anti-money-laundering and counter-terrorist financing obligations, strengthened sanctions compliance, and enhanced Treasury authority to respond to high-risk foreign activity. 

Lawmakers say the goal is to close regulatory gaps without driving legitimate activity overseas.

The bill also addresses decentralized finance and software development, an area that has drawn concern from crypto developers. According to the committee materials, the legislation explicitly protects software developers who publish or maintain code without controlling customer funds, and preserves the right to self-custody digital assets. 

Regulatory obligations would instead focus on centralized intermediaries that interact with DeFi protocols, requiring tailored risk-management and cybersecurity standards.

 “Code is protected — misconduct is not,” the fact sheet states.

Supporters further argue the CLARITY Act closes loopholes rather than creating them. The bill establishes a joint SEC-CFTC advisory committee to harmonize regulatory requirements and includes provisions designed to prevent regulatory arbitrage or evasion of U.S. rules. By bringing activity onshore, lawmakers say federal oversight would be strengthened rather than diluted.

Republicans on the committee also pushed back against claims that the bill was written to benefit industry.

The materials describe the legislation as the product of years of bipartisan work, regulator engagement, and consultation with law enforcement, with an emphasis on public-interest outcomes rather than industry preferences.

This post Ahead of Banking Committee Markup, Senate Republicans Release CLARITY Act Fact Sheets first appeared on Bitcoin Magazine and is written by Micah Zimmerman.