The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have announced a joint event on the future of crypto oversight amid the Trump administration’s push to welcome the sector.

SEC-CFTC Push Joint Crypto Oversight

On Thursday, SEC Chairman Paul Atking and CFTC Chairman Michael Selig announced they will hold an event next week to discuss regulatory harmonization between the two sister agencies.

According to the announcement, the pro-industry chairmen will outline the efforts to work together and cooperate to “deliver on President Trump’s promise to make the United States the crypto capital of the world.”

The event will be hosted on January 27 at the CFTC headquarters and moderated by crypto journalist Eleanor Terret. Additionally, it will be open to the public and livestreamed on both agencies’ websites.

“For too long, market participants have been forced to navigate regulatory boundaries that are unclear in application and misaligned in design, based solely on legacy jurisdictional silos,” said SEC Chair Atkins and CFTC Chair Selig in a joint statement.

“This event will build on our broader harmonization efforts to ensure that innovation takes root on American soil, under American law, and in service of American investors, consumers, and economic leadership,” they added.

Last year, the SEC and CFTC began discussing their options for effectively collaborating on crypto regulations, as a clear framework for digital assets became a top priority for the agencies

As reported by Bitcoinist, the agencies explored reinstating the CFTC-SEC joint advisory committee to develop recommendations on ongoing issues, including efforts in regulatory coordination.

During a September joint roundtable between the two agencies, Atking declared that the era of regulatory fragmentation was ending and the age of harmonized, innovation-friendly crypto oversight was here:

 We are at a crossroads. If we follow the path of our predecessors, America risks ceding leadership in the next chapter of financial history. (…) This ends now (…) our two agencies must work in lockstep to transform dual regulation from a source of confusion into a source of strength. Together, we can offer the best of both worlds: the investor protections that have defined U.S. markets, combined with the innovation-friendly approach that will keep us at the frontier of financial technology throughout the 21st century.

The SEC’s Director of the Division of Trading and Markets, Jamie Selway, highlighted the SEC’s efforts to “further harmonize its rules with our sister regulator, the CFTC. In a January 22 speech, He affirmed that the Division will work shoulder-to-shoulder with the CFTC staff to ensure the US’s continued leadership in financial markets, following Atkins’ September directions.

Congress Regulatory Efforts Stall

The SEC and CFTC’s efforts to regulate the crypto market come as the US Congress struggles to establish a framework to oversee the sector. The Senate Banking Committee’s version of the market structure bill, which focuses on the SEC’s oversight, was delayed after multiple market participants criticized the bill’s draft.

Coinbase CEO Brian Armstrong shared his disappointment with the crypto legislation, withdrawing the company’s support last week. “This version would be materially worse than the current status quo. We’d rather have no bill than a bad bill,” he affirmed.

The Senate Agriculture Committee published its version of the CLARITY Act on Thursday, which mainly addresses the CFTC’s role and regulations, scheduling its markup session for January 27.

Eleanor Terret shared that the industry’s reaction has been mostly positive, “with stakeholders noting the bill’s close similarities to the House Agriculture Committee’s version of the Clarity Act.”

However, recent reports have warned that the Banking Committee’s crypto talks may not resume until later February or early March, as focus shifts to advancing affordable housing plans linked to President Trump’s priorities.

Bitcoin Magazine

Crypto Bill Delayed Several Months as Senate Pivots to Trump’s Housing Initiatives

The sweeping U.S. Senate effort to establish a comprehensive legal framework for cryptocurrency trading and oversight is likely to be pushed back for weeks or even months, after key legislative momentum stalled this week in the wake of major industry backlash.

The Senate Banking Committee indefinitely postponed work on its long-anticipated market structure bill — widely seen as the centerpiece of U.S. crypto regulation — after Coinbase, one of the industry’s largest exchanges, publicly withdrew its support for the measure.

The withdrawal came at a crucial moment before a scheduled markup hearing, where lawmakers would have debated amendments and potentially advanced the bill toward a floor vote. With Coinbase no longer backing the legislation “as written,” the committee has shifted its immediate focus to other priorities, including housing affordability initiatives tied to President Donald Trump’s agenda.

Industry insiders say the delay could stretch into late February or March, according to Bloomberg reporting. Lawmakers wrestled with unresolved policy disputes and are trying to rebuild bipartisan consensus in a sharply divided Senate.

Several factors are contributing to the slowdown. Coinbase’s withdrawal of support, following CEO Brian Armstrong’s decision, shows there are some deep divisions between crypto firms and portions of the bill’s drafters, mainly around stablecoin rewards.

Industry leaders argue that provisions in the current text could weaken the Commodity Futures Trading Commission’s authority, restrict decentralized finance (DeFi), and curtail stablecoin rewards — measures widely viewed as essential to continued crypto innovation. 

Political dynamics are slowing the crypto bill’s progress

At the same time, the traditional banking sector has pushed lawmakers to impose tighter restrictions on yield-bearing crypto products, warning that such features could draw deposits away from banks and destabilize lending markets; that lobbying effort appears to have shaped the bill’s language and intensified industry opposition. 

Also, shifting legislative priorities ahead of the midterm elections have further slowed momentum, as senators face pressure to focus on voter-facing issues such as housing affordability.

While some lawmakers insist the delay is temporary and that robust crypto rules remain achievable, the interruption highlights the fragile nature of legislative consensus on digital assets. 

Senate Agriculture Committee members have released a separate market structure draft, but industry observers caution it may lack the bipartisan backing necessary to prevail.

Patrick Witt, executive director of the White House council on digital assets, has publicly urged continued negotiation, describing regulatory clarity as “a question of when, not if.” However, he warned that without industry cooperation, future iterations could be less favorable to crypto firms.

This post Crypto Bill Delayed Several Months as Senate Pivots to Trump’s Housing Initiatives first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

Cryptocurrency exchange Coinbase (COIN) recently retracted its support for the latest iteration of the crypto market structure bill, known as the CLARITY Act, just 24 hours before a crucial markup was scheduled. 

This signals significant concerns about the bill’s alignment with the interests of cryptocurrency firms compared to traditional banking institutions, not only for the exchange but also for broader market participants.

Coinbase CEO’s Concerns Over Fair Competition

On Friday, Coinbase CEO Brian Armstrong elaborated on the rationale behind the exchange’s withdrawal in an appearance on FOX Business, expressing his frustration with the notion that banks could use regulatory means to stifle competition in their favor. 

“It just felt deeply unfair to me that one industry [banks] would come in and get to do regulatory capture to ban their competition,” Armstrong stated. He also underscored the importance of a level playing field, asserting that competition should thrive without undue interference from powerful financial entities.

Coinbase CEO emphasized that his concerns resonate with “much of the industry,” highlighting his obligation to advocate for customers who he believes are being shortchanged by the provisions of the proposed market legislation. 

“I declined to opine on the exact—whether the hearing, the markup should happen or not… But I did feel like I had to speak up on behalf of our customers and all Americans here,” he articulated.

Debate Heats Over CLARITY Act

Central to the ongoing debate surrounding the CLARITY Act is a critical disagreement between banks and crypto firms regarding the fate of stablecoin holders and whether they should be entitled to receive reward payments. 

Armstrong has previously raised alarms that the bill might prohibit tokenized equities, impose restrictions on decentralized finance (DeFi), and expand governmental access to financial data, thereby compromising individual privacy. 

Furthermore, he warned that the legislation could shift regulatory authority away from the Commodity Futures Trading Commission (CFTC) and towards the Securities and Exchange Commission (SEC), sidelining competition within the crypto space.

Armstrong Critiques Banking Lobbying Tactics

Armstrong noted the irony in the current situation, pointing out that while banks are indeed leveraging the advantages of cryptocurrency, their lobbying efforts seem aimed at restricting competing firms. 

“Many of these banks are actually very smart,” he acknowledged, referencing the commercial side of banking that is increasingly engaging with crypto. “They’re actually doing deals with Coinbase. We’re powering a lot of crypto and stablecoin infrastructure for them on the commercial side.”

Despite his criticisms of the banking sector’s lobbying tactics, Armstrong expressed optimism that legislators could ultimately resolve the outstanding issues within the crypto market structure bill:

And then their lobbying arm comes to D.C. and thinks of it as very zero-sum and is trying to kill the competition. So, I suspect, like many things, if we get the principles in the room, we can actually get this figured out and make a good deal.

Featured image from DALL-E, chart from TradingView.com 

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.

The cryptocurrency market is showing signs of short-term relief as Bitcoin and major altcoins attempt to stabilize after weeks of sustained selling pressure. Prices have rebounded modestly across the board, easing some of the recent bearish momentum. However, sentiment remains fragile. Many analysts argue that this move fits the profile of a relief rally rather than the start of a durable trend reversal, pointing to still-weak market structure and unresolved macro and regulatory risks.

Against this backdrop, a draft market structure bill released by the US Senate is drawing significant attention.  The proposed framework represents a potential structural shift in how crypto assets are treated within the US financial system.

The bill aims to clearly differentiate which crypto assets fall under the definition of commodities and which qualify as securities, while assigning regulatory oversight accordingly. Until now, the US regulatory approach has largely relied on enforcement actions, creating uncertainty for investors, developers, and institutions alike. By outlining classification criteria in advance, the proposal seeks to reduce ambiguity and provide a cleaner operating environment.

As markets digest this information, the focus is shifting from headline-driven volatility toward longer-term structural implications. Whether this regulatory clarity translates into sustained confidence remains an open question.

Regulatory Clarity Signals a Shift

A report from XWIN Research Japan highlights a critical nuance in the latest US market structure proposal: fully decentralized networks and DeFi protocols are not treated as traditional financial intermediaries. Developers, validators, and node operators are not automatically classified as regulated entities, signaling a formal recognition of decentralization as a core structural attribute rather than a loophole to be closed.

This distinction is meaningful, as it reduces legal uncertainty for open-source contributors and preserves the permissionless nature of decentralized infrastructure.

In contrast, centralized entities face a more clearly defined regulatory perimeter. Exchanges, brokers, and custodians are expected to comply with stricter rules on registration, asset segregation, and disclosure. Rather than targeting innovation, these requirements appear designed to professionalize market infrastructure and align centralized crypto businesses with existing financial standards.

Within this framework, Bitcoin, Ethereum, stablecoins, and spot ETFs are implicitly assumed to remain integrated into the US financial system, reinforcing their status as legitimate financial instruments.

On-chain data already reflects this transition. Metrics from CryptoQuant show that near the $90,000 Bitcoin level, retail activity remains muted while mid- and large-sized spot orders dominate. This pattern suggests neither speculative excess nor panic-driven exits, but measured positioning by larger investors.

Taken together, these signals imply a market gradually shifting from reactive, headline-driven behavior toward a more structure-driven phase. Regulatory clarity may not spark immediate price moves, but it is already influencing how capital positions itself across the crypto landscape.

Total Crypto Market Cap Enters Consolidation Phase

The total cryptocurrency market capitalization chart shows a market in consolidation after an aggressive multi-quarter expansion. Following the strong advance from late 2023 into mid-2025, total market cap peaked near the $3.8–$4.0 trillion zone before entering a corrective phase. Since then, price action has transitioned into a broad range, with higher volatility compressing into a more orderly structure.

Currently, the total market cap is hovering around the $3.2 trillion level, which aligns with a key former resistance zone that has now acted as support multiple times. The weekly structure suggests a cooling phase rather than a breakdown. Price remains above the rising 200-week moving average, which continues to slope upward and reinforces the idea that the primary market trend is still constructive.

Shorter-term moving averages have flattened, reflecting indecision and reduced momentum after the earlier impulsive move. Volume has declined from peak levels, indicating that aggressive distribution pressure has eased, but strong expansion demand has not yet returned. This combination is typical of mid-cycle consolidation rather than terminal weakness.

From a structural perspective, the market is digesting prior gains while maintaining a higher-low framework relative to previous cycles. A sustained hold above the $3.0 trillion region keeps the broader bullish structure intact. However, failure to defend this zone would expose the market to deeper retracements toward long-term trend support.

Featured image from ChatGPT, chart from TradingView.com 

Bitcoin Magazine

Coinbase Says ‘No’ to CLARITY Act, Citing Crypto Restrictions

Coinbase CEO Brian Armstrong said the exchange cannot support the Senate Banking Committee’s latest draft of the CLARITY Act, warning that the bill, as written, would leave the U.S. crypto industry worse off than the current regulatory status quo.

In a post on X, Armstrong cited several concerns, including what he described as a de facto ban on tokenized equities, new restrictions on decentralized finance that could grant the government broad access to users’ financial data, and provisions that weaken the Commodity Futures Trading Commission while expanding the Securities and Exchange Commission’s authority.

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

He also criticized draft amendments that would eliminate rewards on stablecoins, arguing they would allow banks to suppress emerging competitors.

“We’d rather have no bill than a bad bill,” Armstrong said on X, adding that Coinbase would continue pushing for a framework that treats crypto on a level playing field with traditional financial services.

BREAKING: Coinbase CEO Brian Armstrong says Coinbase "can't support" the crypto market structure legislation as currently written

"We'd rather have no bill than a bad bill." pic.twitter.com/3BCgWw0kM9

— Bitcoin Magazine (@BitcoinMagazine) January 14, 2026

The comments come a day before the Senate Banking Committee is expected to mark up the CLARITY Act on Thursday, January 15. 

The legislation is trying to clarify U.S. digital asset market structure by defining categories such as digital commodities, investment contracts, and payment stablecoins, while dividing oversight between the SEC and CFTC.

Coinbase’ issues with stablecoin rewards

Stablecoin rewards have emerged as a flashpoint in negotiations. Coinbase had reportedly warned lawmakers it may withdraw support for the bill if it restricts yield programs tied to stablecoins like USD Coin. 

Coinbase shares in interest income generated from USDC reserves and uses part of that revenue to offer incentives to users, including rewards of roughly 3.5% for Coinbase One customers.

Stablecoin-related revenue may have reached $1.3 billion in 2025, making the issue central to Coinbase’s business model. 

Banking groups argue that yield-bearing stablecoins could draw deposits away from traditional banks, while crypto firms counter that banning rewards would stifle innovation and push users toward offshore platforms.

“I’m actually quite optimistic that we will get to the right outcome with continued effort,” Armstrong later posted on X. “We will keep showing up and working with everyone to get there.”

Michael Saylor, executive chairman of Strategy, retweeted Armstrong’s post, showing his own support with the decision. 

This post Coinbase Says ‘No’ to CLARITY Act, Citing Crypto Restrictions first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

Bitcoin has spent several weeks struggling around a pivotal price range, frustrating traders and reinforcing bearish narratives across the market. After failing to reclaim key resistance levels, a growing number of analysts are calling for a broader bear market to unfold. Price action has been choppy, momentum has faded, and volatility has compressed—conditions that often amplify pessimism. Yet beneath the surface, some analysts argue that Bitcoin is no longer behaving as it did in previous cycles.

According to this view, the market structure itself is changing. Long-term holders appear less reactive, sell-side pressure has moderated, and on-chain activity suggests a slower, more deliberate market. Rather than a reflexive risk asset, Bitcoin is increasingly traded and held with a longer time horizon. This shift becomes especially relevant as the policy backdrop evolves in the United States.

The US Senate Banking Committee is scheduled to mark up the crypto market structure bill known as the CLARITY Act on January 15, 2026. This event should not be interpreted as a short-term price catalyst. Instead, it represents a potential inflection point in how Bitcoin is positioned within the US regulatory framework.

While prices remain relatively stable, on-chain data already hints at a market adapting to a more institutional, regulated environment. The implication is clear: Bitcoin may be entering a structurally different phase, even as sentiment remains divided.

On-Chain Signals Point to Patience, Not De-Risking

A report by CryptoQuant, authored by XWIN Research Japan, highlights that Exchange Netflow remains a critical signal in the current environment. Historically, periods of regulatory uncertainty tend to push Bitcoin into exchanges as investors prepare to sell or reduce exposure.

Ahead of the upcoming CLARITY bill discussions, however, this behavior has not materialized. Exchange inflows have stayed relatively muted, suggesting that market participants are not positioning defensively or treating the legislative process as an immediate threat.

SOPR (Spent Output Profit Ratio) reinforces this interpretation. The metric, which measures whether moved coins are sold at a profit or a loss, is hovering around or slightly below the 1.0 threshold. This indicates subdued profit-taking activity. More importantly, it implies that on-chain spending itself remains low. In simple terms, Bitcoin is not being moved aggressively, either to realize gains or to exit positions.

Together, Exchange Netflow and SOPR point to a market posture that is patient rather than defensive. Investors appear willing to hold through uncertainty instead of rotating capital or rushing to de-risk. The time horizon is clearly lengthening.

From this perspective, the CLARITY Act represents more than a policy debate. It marks a potential step toward integrating Bitcoin into the U.S. financial framework as a regulated digital commodity. On-chain data already reflects this shift: before any major price move, Bitcoin is becoming increasingly “sticky,” signaling a transition away from speculative trading and toward institutional-grade holding behavior.

Bitcoin Price Consolidation Continues

Bitcoin price action remains constrained within a well-defined consolidation range, following the sharp correction that began in November. After rejecting from the $120K–$125K region, BTC experienced an impulsive sell-off that found a local bottom near the mid-$80K zone, where demand visibly stepped in. Since then, price has been carving a higher low structure, suggesting that downside momentum is gradually weakening.

On the daily chart, Bitcoin is now attempting to stabilize above the $92K area, which aligns closely with a former support-turned-resistance level. This zone has acted as a pivot throughout the current range and remains critical for short-term direction. A sustained hold above it would strengthen the case for a broader recovery toward the $98K–$100K region, where the declining short-term moving averages converge.

However, the broader trend remains technically fragile. Price is still trading below the 100-day and 200-day moving averages, both of which are sloping downward. This indicates that the medium-term structure has not yet shifted back to bullish. Volume also remains relatively muted, reinforcing the idea that this move is corrective rather than impulsive.

As long as Bitcoin remains trapped between roughly $88K and $95K, the market is likely to remain range-bound. A decisive break above resistance or a loss of current support will be required to resolve this consolidation phase and define the next directional move.

Featured image from ChatGPT, chart from TradingView.com 

As the January 15 markup of the crypto market structure bill—known as the CLARITY Act—draws closer, reports indicate that Coinbase (COIN) is reconsidering its support for the legislation. 

A Monday report from Bloomberg suggests this shift in position is contingent on whether the anticipated bill includes provisions beyond enhanced disclosure requirements tied to stablecoin rewards.

High Stakes For Coinbase

The CLARITY Act is expected to be marked up in at least one Senate committee this Thursday, and Coinbase’s potential withdrawal could have significant implications for the bill. 

A source familiar with Coinbase’s stance told Bloomberg that the exchange would re-evaluate its support if the legislation veers too far from its interests, particularly regarding stablecoin incentives.

Some insiders suggest the bill might restrict the ability to provide rewards to regulated financial institutions, a move that aligns with the banking sector’s concerns about losing deposits to crypto platforms.

Coinbase currently holds applications for a national trust charter that could permit it to offer those kinds of rewards under regulatory rules. However, many crypto-native firms are pushing back against potential restrictions, arguing that such measures could disrupt competition in the market.

The stakes for Coinbase are high, as rewards programs play a crucial role in its business model. The exchange allows users to earn 3.5% rewards on Circle’s USDC holdings. 

Should the market-structure bill include bans on these incentives, fewer users might choose to hold stablecoins on the platform. This could jeopardize an anticipated revenue stream projected at $1.3 billion in 2025, according to Bloomberg.

Banking Vs. Crypto

The GENIUS Act, passed into law in July of last year, prohibits stablecoin issuers from offering interest on token holdings, and does not prevent third-party partners like Coinbase from providing rewards tied to customer balances. 

The banking industry, however, argues that allowing exchanges to pay such rewards could negatively impact bank deposits and, consequently, community lending. 

As reported by Bitcoinist over the past month, the American Bankers Association (ABA) has voiced concerns that this situation could displace “billions” from local lending, allegedly harming small businesses and households.

In contrast, Faryar Shirzad, Coinbase’s chief policy officer, has argued that maintaining rewards tied to stablecoins is crucial for preserving the dollar’s dominance, especially in light of China’s announcement to start offering interest on its digital yuan.

Banking Lobby Fights Back

A potential compromise being discussed would permit only licensed banking entities or financial institutions to provide rewards on stablecoin balances. 

Recently, five crypto firms, including Ripple, Circle, and Paxos, received conditional approvals from the US Office of the Comptroller of the Currency (OCC) to become national trust banks, a move met with opposition from the banking lobby. 

If restrictions are indeed imposed, the report suggests that this could lead to creative workarounds as crypto firms seek alternative ways to reward customers. 

Featured image from DALL-E, chart from TradingView.com

In a major new development for the crypto industry, Senators Ron Wyden and Cynthia Lummis announced on Monday evening the introduction of a bipartisan, standalone version of the Blockchain Regulatory Certainty Act (BRCA). 

This legislation aims to provide much-needed clarity for software developers and infrastructure providers in the blockchain space, particularly concerning their classification under federal law.

New Crypto Bill To Protect Blockchain Developers 

According to the detailed press release regarding the matter, the BRCA specifies that developers and providers who do not have control over user funds will not be classified as money transmitters. Senator Lummis highlighted the ongoing challenges faced by blockchain developers, stating: 

Blockchain developers who have simply written code and maintain open-source infrastructure have lived under threat of being classified as money transmitters for far too long. This designation makes no sense when they never touch, control, or have access to user funds, and unnecessarily limits innovation. 

Lummis emphasized that the bill provides developers with the clarity needed to advance digital finance without the fear of legal repercussions for activities that do not pose a money laundering risk. Lummis added, “It’s time to stop treating software developers like banks simply because they write code.”

Senator Wyden echoed these concerns, arguing that imposing the same regulatory requirements on developers as those applied to exchanges or brokers is fundamentally flawed. 

Main Highlights Of The BRCA

The Blockchain Regulatory Certainty Act aims to set clear federal standards defining when blockchain developers and service providers can be exempt from money transmitter regulations. 

Under current legislation toward crypto, the Senators assert blockchain developers face regulatory ambiguities that have not only stifled innovation but also driven many projects offshore, as they navigate conflicting regulations across different states.

The bill specifically establishes that a “non-controlling developer or provider” refers to any entity that develops or maintains distributed ledger technology but does not possess the unilateral authority to initiate or execute transactions involving users’ digital assets without third-party consent.

In addition, the crypto bill clarifies protected activities, including the development or publication of software for distributed ledgers, maintenance services for blockchain networks, offering customer self-custody solutions, and providing necessary infrastructure to support distributed ledger services. 

Importantly, while the bill allows states to enforce their laws consistent with federal regulations, it also prevents them from imposing money transmitter requirements on developers engaged solely in the specified protected activities.

Featured image from DALL-E, chart from TradingView.com 

Washington state lawmakers are taking another run at regulating artificial intelligence, rolling out a slate of bills this session aimed at curbing discrimination, limiting AI use in schools, and imposing new obligations on companies building emotionally responsive AI products.

The state has passed narrow AI-related laws in the past — including limits on facial recognition and distributing deepfakes — but broader efforts have often stalled, including proposals last year focused on AI development transparency and disclosure.

This year’s bills focus on children, mental health, and high-stakes decisions like hiring, housing, and lending. The bills could affect HR software vendors, ed-tech companies, mental health startups, and generative AI platforms operating in Washington.

The proposals come as Congress continues to debate AI oversight with little concrete action, leaving states to experiment with their own guardrails. An interim report issued recently by the Washington state AI Task Force notes that the federal government’s “hands-off approach” to AI has created “a crucial regulatory gap that leaves Washingtonians vulnerable.”

Here’s a look at five AI-related bills that were pre-filed before the official start of the legislative session, which kicks off Monday.

HB 2157

This sweeping bill would regulate so-called high-risk AI systems used to make or significantly influence decisions about employment, housing, credit, health care, education, insurance, and parole.

Companies that develop or deploy these systems in Washington would be required to assess and mitigate discrimination risks, disclose when people are interacting with AI, and explain how AI contributed to adverse decisions. Consumers could also receive explanations for decisions influenced by AI.

The proposal would not apply to low-risk tools like spam filters or basic customer-service chatbots, nor to AI used strictly for research. Still, it could affect a wide range of tech companies, including HR software vendors, fintech firms, insurance platforms, and large employers using automated screening tools. The bill would go into effect on Jan. 1, 2027.

SB 5984

This bill, requested by Gov. Bob Ferguson, focuses on AI companion chatbots and would require repeated disclosures that an AI chatbot is not human, prohibit sexually explicit content for minors, and mandate suicide-prevention protocols. Violations would fall under Washington’s Consumer Protection Act.

The bill’s findings warn that AI companion chatbots can blur the line between human and artificial interaction and may contribute to emotional dependency or reinforce harmful ideation, including self-harm, particularly among minors.

These rules could directly impact mental health and wellness startups experimenting with AI-driven therapy or emotional support tools — including companies exploring AI-based mental health services, such as Seattle startup NewDays.

Babak Parviz, CEO of NewDays and a former leader at Amazon, said he believes the bill has good intentions but added that it would be difficult to enforce as “building a long-term relationship is so vaguely defined here.”

Parviz said it’s important to examine systems that interact with minors to make sure they don’t cause harm. “For critical AI systems that interact with people, it’s important to have a layer of human supervision,” he said. “For example, our AI system in clinic use is under the supervision of an expert human clinician.”

OpenAI and Common Sense Media are partnering on a ballot initiative in California also focused on chatbots and minors.

SB 5870

A related bill goes even further, creating a potential civil liability when an AI system is alleged to have contributed to a person’s suicide.

Under this bill, companies could face lawsuits if their AI system encouraged self-harm, provided instructions, or failed to direct users to crisis resources — and would be barred from arguing that the harm was caused solely by autonomous AI behavior.

If enacted, the measure would explicitly link AI system design and operation to wrongful-death claims. The bill comes amid growing legal scrutiny of companion-style chatbots, including lawsuits involving Character.AI and OpenAI.

SB 5956

Targets AI use in K–12 schools, banning predictive “risk scores” that label students as likely troublemakers and prohibiting real-time biometric surveillance such as facial recognition.

Schools would also be barred from using AI as the sole basis for suspensions, expulsions, or referrals to law enforcement, reinforcing that human judgment must remain central to discipline decisions.

Educators and civil rights advocates have raised alarms about predictive tools that can amplify disparities in discipline.

SB 5886

This proposal updates Washington’s right-of-publicity law to explicitly cover AI-generated forged digital likenesses, including convincing voice clones and synthetic images.

Using someone’s AI-generated likeness for commercial purposes without consent could expose companies to liability, reinforcing that existing identity protections apply in the AI era — and not just for celebrities and public figures.

Bitcoin Magazine

Trump’s Second Term Creates Rare ‘Golden Window’ for Any Crypto Policy Progress: Report

The U.S. is entering what may be the most favorable policy environment for crypto since the industry emerged, as President Donald Trump’s second term accelerates deregulation across financial markets and pulls digital assets closer to the center of the U.S. financial system, according to a new outlook from TD Cowen’s Washington Research Group.

The report, shared with Bitcoin Magazine, characterizes 2026 as a rare convergence of aligned regulators, political will, and market momentum, creating a short window in which crypto firms could secure lasting policy gains. 

Those gains, however, are not guaranteed to endure. TD Cowen repeatedly warned in its report that many initiatives could be revised or reversed by a future Democratic administration if they are not finalized, implemented, and legally defended before the next presidential transition in 2029.

Rather than sweeping crypto legislation, the firm expects change to arrive through exemptions, agency guidance, new charters, and targeted market-structure adjustments. The result is a regulatory strategy that emphasizes speed and durability over ambition.

TD Cowen describes the broader environment as a “golden age of deregulation” for financial services, housing, and crypto. 

The report says Trump has moved faster than prior presidents to assert control over financial regulators, installing leadership teams explicitly committed to lighter, more tailored oversight and a more permissive stance toward digital assets and tokenization.

The White House, Treasury Department, and market regulators are described as unusually aligned on the view that regulation should accommodate innovation rather than constrain it. 

Timing is critical for any crypto progress 

That alignment underpins many of the crypto initiatives expected to unfold in 2026, but TD Cowen cautions that timing is critical. Rules must be finalized this year to withstand court challenges and become harder to unwind if political control shifts after the 2028 election.

At the Securities and Exchange Commission, the report says Chair Paul Atkins is preparing to use exemptive relief to expand crypto-related activity within U.S. securities markets. The SEC is expected to issue so-called “innovation exemptions” as early as the first quarter of 2026, allowing brokerages and crypto platforms to offer tokenized stocks and bonds that settle instantly and operate outside certain elements of the National Market System.

TD Cowen expects early tokenized equity trading to focus on retail investors and benefit online brokerages and crypto-native exchanges. 

The SEC is likely to loosen best-price obligations for these products while leaving the core Order Protection Rule intact for traditional markets. 

The firm assigns the initiative a moderate sustainability rating, suggesting a future Democratic SEC would layer on investor protections rather than dismantle tokenization altogether.

The SEC is also expected to clarify how staking-as-a-service programs are treated under securities law. Fixed-return staking products would likely be classified as securities, while variable, profit-sharing arrangements could be treated as fee-for-service activities. 

TD Cowen sees growing bipartisan agreement that staking requires a clearer framework, even if the details remain contested.

On the banking side, regulators have begun opening the perimeter to crypto firms while maintaining formal limits on deposit-taking and lending. 

In December 2025, the Office of the Comptroller of the Currency granted national trust charters to several crypto firms, including Circle, Ripple, and Paxos, allowing them to hold stablecoin reserves under a single federal regime instead of navigating state-by-state oversight.

TD Cowen argues these charters deepen the integration between traditional banking and digital assets and could eventually pave the way for banks to issue and manage stablecoins themselves. 

While Democrats could tighten supervision if they regain power, the firm views outright revocation as unlikely.

The Federal Reserve is also moving to accommodate crypto-linked payments activity. The report highlights a proposal for “Payment Master Accounts” that would grant eligible crypto and payments firms limited, non-interest-bearing access to the Fed’s payment rails. 

These accounts would process transactions without providing overdrafts or discount-window access. TD Cowen sees the move as durable once implemented, despite concerns from banks about increased competition.

The CLARITY act is a centerpiece for crypto progress

On Capitol Hill, the centerpiece of the crypto agenda is a proposed market-structure bill known as the CLARITY Act. TD Cowen remains skeptical that Congress will deliver a second major legislative win after passing stablecoin legislation, but it says a narrow compromise remains possible on investor protection, custody standards, and anti–money laundering rules.

The largest obstacle is Democratic insistence on ethics provisions barring senior government officials and their families from owning crypto exchanges, issuing tokens, or operating stablecoins — language aimed at Trump’s ties to World Liberty Financial. 

TD Cowen warns there is no easy compromise on this issue, raising the risk that market-structure legislation slips into 2027 or collapses altogether.

Beyond trading and regulation, the report points to growing interest in tokenizing real-world records, including property deeds, mortgage documentation, and medical files. These projects are framed as efficiency upgrades rather than deregulatory flashpoints, making them more politically durable.

This post Trump’s Second Term Creates Rare ‘Golden Window’ for Any Crypto Policy Progress: Report first appeared on Bitcoin Magazine and is written by Micah Zimmerman.