Bitcoin Falls Below $96,000 as Senate Delays Crypto Market Structure Markup

Bitcoin (BTC) declined below $96,000 on Thursday after the U.S. Senate Banking Committee canceled its markup of the Digital Asset Market Clarity Act. The delay followed objections from major industry stakeholders and growing concerns over key provisions in the bill.

The proposed legislation aimed to clarify regulatory responsibilities between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). However, Coinbase CEO Brian Armstrong criticized the bill's approach, arguing it would harm innovation in the crypto space.

The Senate Banking Committee's chair, Tim Scott, stated that bipartisan negotiations are continuing. He emphasized the need for clear regulatory rules that protect consumers and strengthen U.S. financial leadership in the digital asset space.

Why Did This Happen?

The cancellation came after Coinbase CEO Brian Armstrong rejected the bill in a public statement. Armstrong cited several concerns, including a de facto ban on tokenized equities and restrictions on stablecoin rewards. He stated, "We'd rather have no bill than a bad bill," highlighting the need for balanced regulation.

The bill's provisions on stablecoin interest payments had already sparked industry pushback. Critics argued that banning interest for holding stablecoins would unfairly impact crypto companies like Coinbase, which rely on stablecoin-related revenue.

How Did Markets React?

Bitcoin dropped over 1% in Thursday trading, dipping below $96,000 and threatening to break a four-day recovery trend. Ethereum (ETH) and other major altcoins also declined as traders priced in the regulatory uncertainty.

The move has raised concerns about the bill's future. Without key industry support, the markup process is likely to be delayed further, complicating efforts to pass comprehensive regulations before the end of 2026.

The delay has also impacted related equities. Coinbase shares fell by roughly 3%, while Strategy, a firm with significant Bitcoin holdings, saw similar losses.

What Are Analysts Watching Next?

Analysts are closely monitoring how lawmakers and industry stakeholders can reach a compromise. The main sticking points include stablecoin yield policies and the division of regulatory oversight between agencies.

The revised bill may include exceptions for activity-based rewards, but the broader debate over financial inclusion and consumer choice remains unresolved.

Market participants are also watching for signals from the Federal Reserve. With inflation easing and rate cuts increasingly expected later in 2026, the macroeconomic backdrop could provide additional support for crypto assets.

The Senate Banking Committee has not yet announced a new date for the markup. Until a revised version of the bill is finalized, the regulatory landscape for digital assets remains in flux, with ongoing uncertainty likely to affect market sentiment.