Senator Lummis Pushes for Crypto Bills by 2026 Amid Regulatory Shifts

Senator Cynthia Lummis of Wyoming has set a clear goal for Congress to pass two key cryptocurrency bills by the end of 2026. These bills, the Digital Asset Market Clarity Act (CLARITY Act) and the Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act), are pivotal in establishing regulatory frameworks for digital assets and stablecoins. Lummis, who chairs the Senate Banking Committee’s digital asset subcommittee, expressed her determination to see these bills through, stating that she would be “extremely disappointed” if they did not pass by the set deadline.

Lummis discussed the progress of these bills at the Bitcoin Policy Summit in Washington, D.C. The CLARITY Act, currently in the House of Representatives, aims to provide clarity on the legal status of cryptocurrencies. The GENIUS Act, which has already received strong Senate approval, focuses on establishing guidelines for stablecoins. The GENIUS Act has been sent to the House for further consideration, but there are indications that House leadership may delay its progress, adding uncertainty to its future.

The political landscape surrounding these bills is fraught with challenges. A recent Senate hearing on digital asset market structure highlighted deepening political divides. The hearing, chaired by Lummis, saw low attendance from the Senate Banking Committee’s digital assets subcommittee, with only five of the 11 members present. This lack of bipartisan engagement raised concerns about the progress of digital asset legislation. Lummis pointed to the scheduling of multiple competing committee meetings as a possible reason for the poor turnout but expressed concern about the growing partisanship surrounding crypto legislation. She hinted at potential political motivations and suggested that concerns over certain administration members’ family ties to the crypto industry might be influencing Democratic resistance.

Despite these challenges, there are signs of progress in the regulatory landscape. The Federal Reserve has announced a major policy shift by directing its supervisors to stop considering “reputational risk” in the oversight of banks. This move is seen as a significant win for the cryptocurrency industry, which has long argued that the ambiguous concept of reputational risk was used to justify the debanking of crypto firms. The Federal Reserve Board stated that it started reviewing its supervisory materials to remove references to reputational risk and replace them with more specific discussions focused on financial risk. The central bank also plans to train its examiners accordingly and ensure the change is consistently applied across all banks it supervises.

This policy shift by the Federal Reserve is part of a broader rollback of crypto restrictions by U.S. regulators. In May, the Office of the Comptroller of the Currency confirmed that banks under its oversight are allowed to trade crypto and outsource related services. Similarly, the Federal Deposit Insurance Corporation clarified in March that banks can now engage in crypto-related activities without requiring prior approval. These developments indicate a more supportive stance from regulators, which could help alleviate some of the regulatory uncertainty facing the crypto industry.

In summary, Senator Lummis’ goal to pass the CLARITY Act and the GENIUS Act by 2026 reflects the growing importance of digital assets in the legislative agenda. While political divides and regulatory challenges remain, recent policy shifts by the Federal Reserve and other regulators suggest a more supportive environment for the crypto industry. The progress of these bills will be closely watched as Congress navigates the complex landscape of digital asset regulation.