Crypto Bills Advance in Congress Amid Bipartisan Support

The House Financial Services Committee is set to mark up market structure legislation next week, while the Senate is nearing a vote on its stablecoin bill. The House Financial Services Committee and the House Agriculture Committee will hold markups on the Digital Asset Market Clarity Act, also known as the Clarity Act, on Tuesday. This markup is expected to result in a vote to advance the bill to the broader House of Representatives.

On the Senate side, lawmakers may hold a series of votes as early as Monday on the Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 Act, or GENIUS, to advance it. Senator Ruben Gallego, who spearheaded a pause in the bill's advancement, expects a massive bipartisan vote in favor of the legislation. The bill will need 60 votes to clear cloture and a simple majority afterward to pass the Senate entirely. After that, it will move to the House.

Gallego stated, "We've worked in a very honest, earnest manner with our Republican colleagues. We think that they've been also doing the same. They adopted a lot of the amendments, most of the amendments that we've been adding, and they've been continuing to work with some other Democrats who have some other concerns, but we believe that if all the changes are made, it's going to be a very solid, comprehensive bill that I think we could all be proud to vote for."

By the end of next week, it is possible that the House of Representatives will have both a market structure bill and a stablecoin bill to consider, amend, and vote on. However, whether both bills will make it to the President's desk by the August recess is uncertain. Policymakers in Washington, D.C. this week seemed skeptical that both bills would be passed by that deadline, though stablecoin legislation is likely to clear the House and Senate by then.

One theory suggests that the GENIUS Act in the Senate might be tagged onto the House's Clarity Act, allowing the House to vote on both its market structure bill and stablecoin bill at once and sending both back to the Senate. However, this path is likely to face pushback from both House and Senate lawmakers. The more likely possibility is that market structure legislation will take longer, perhaps through the end of the year.

Democrats have ongoing concerns that the President is enriching himself through his various crypto ventures. This week, the President's media firm, Truth Social, filed for a spot bitcoin exchange-traded fund (ETF) with Yorkville America and NYSE Arca. Assuming this product is approved, it will open another avenue for a Trump-affiliated entity to benefit from interest in the industry.

House Financial Services Committee Chair French Hill said the House and Senate's respective stablecoin bills are close but need some work to be fully aligned with each other. The House Financial Services Committee and House Agriculture Committee each held a hearing to discuss the Clarity Act, the new House market structure bill. Democrats on the House Financial Services Committee held another hearing focused on the President's crypto tie-ups, as well as the market structure bill introduced by House Republicans last week.

In summary, the crypto industry has been waiting for years for Congress to pass legislation providing regulatory clarity. Congress has taken several key steps this year, and next week may see significant progress with the advancement of market structure and stablecoin bills. The Senate's GENIUS Act and the House's Clarity Act are both moving forward, with the potential for bipartisan support and eventual passage. However, the timeline for both bills to reach the President's desk remains uncertain, with market structure legislation potentially taking longer to advance.

Analysis: The advancement of crypto legislation in Congress marks a significant step towards providing regulatory clarity for the crypto industry. The bipartisan support for the GENIUS Act in the Senate and the progress of the Clarity Act in the House indicate a growing consensus on the need for clear guidelines for stablecoins and market structure. However, the potential for pushback on combining the two bills and the ongoing concerns about the President's crypto ventures add layers of complexity to the legislative process. The outcome of these bills will have far-reaching implications for the future of crypto regulation in the U.S.