Senate Puts Crypto Bill on Ice to Reopen Government, Delaying Industry Clarity Until 2025

The U.S. Senate is poised to prioritize a government funding bill over the long-awaited crypto market structure legislation as the 36-day government shutdown continues to disrupt regulatory operations. Lawmakers are focusing on reopening federal agencies, with the crypto bill's timeline now extending into early 2025, according to Senator Cynthia Lummis, a key Republican advocate for digital assets and reported by Coinotag. The bill, which seeks to establish a regulatory framework for digital assets and decentralized finance (DeFi), faces delays due to furloughed staff at the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), critical for its implementation.

The crypto industry's legislative momentum, however, remains robust. Bipartisan negotiations led by Senators John Boozman (R-Ark.) and Cory Booker (D-N.J.) have produced a draft bill that addresses stablecoin oversight and DeFi protocols, according to Coinpaper. White House advisor David Sacks highlighted progress on "shared language" between parties, with a final version expected by 2026. The legislation aims to clarify the SEC and CFTC's roles in regulating digital assets, a move welcomed by crypto firms seeking legal certainty after high-profile collapses like FTX.

Meanwhile, President Donald Trump's pro-crypto policies have reshaped the industry's political landscape. His pardons of Binance founder Changpeng Zhao and Tether CEO Paolo Ardoino have drawn sharp criticism, with Democrats accusing the administration of fostering conflicts of interest, according to Politico. Tether's U.S. subsidiary, which is funding Trump's new White House ballroom, has also sparked ethical concerns. Critics argue these ties could compromise regulatory neutrality, though Trump's team insists the policies are designed to position the U.S. as the "crypto capital of the world."

The market reaction to these developments has been mixed. Bitcoin fell below $100,000 in early November, with $1.3 billion in crypto liquidations reported as investors reacted to Trump's Supreme Court tariff case and broader risk-off sentiment, according to Yahoo Finance. Despite regulatory optimism, institutional outflows from spot Bitcoin ETFs and geopolitical uncertainty have dampened bullish momentum.

As the Senate weighs its next steps, the crypto bill's delayed timeline reflects the broader tension between fiscal priorities and industry demands. With the 2026 midterms approaching, lawmakers face pressure to finalize a framework that balances innovation with oversight. For now, the path forward hinges on resolving the government shutdown and navigating partisan divides, with the industry watching closely for signals of regulatory clarity in the new year.