Furloughs Among Regulators Stall Crypto Legislation, Postponing U.S. Leadership in Digital Assets
- U.S. Senate delays crypto bill passage due to 36-day government shutdown furloughing key SEC/CFTC staff. - Bipartisan draft aims to clarify digital asset regulation and DeFi oversight amid partisan debates over consumer protections vs. innovation. - Shutdown limits technical expertise for bill development, with unresolved agency jurisdiction issues likely in December drafts. - Passage expected by early 2025 would establish U.S. leadership in crypto regulation while balancing oversight and industry growth.
Progress on the U.S. Senate’s major crypto market structure legislation has stalled due to the
Despite the shutdown, bipartisan talks led by Senators John Boozman (R-Ark.) and Cory Booker (D-N.J.) are ongoing. The proposed legislation seeks to clarify digital asset regulations, close oversight gaps, and encourage growth in decentralized finance (DeFi). David Sacks, the White House adviser on crypto and AI, recently voiced optimism
The shutdown has further complicated matters by restricting access to technical expertise necessary for drafting the bill. Patrick Witt, executive director of President Donald Trump’s Council of Advisors for Digital Assets, remarked that while the pause has caused logistical setbacks, it has also enabled more direct stakeholder engagement. Lummis conceded that the lack of fully functioning regulatory agencies makes it harder to get their input, stating, “We’re making significant headway, but limited agency capacity remains a challenge.”
With the Senate preparing for a recess next week, the chances of advancing the bill by Thanksgiving have faded, shifting expectations to December. The Agriculture Committee’s draft is still evolving and will likely feature bracketed text to highlight unresolved policy issues, especially regarding agency authority and enforcement, according to a
This delay highlights the complex relationship between legislative priorities and the political timetable. Senator Thom Tillis (R-N.C.) cautioned that lawmakers have until January or February 2025 to complete the bill before midterm election pressures make further progress difficult. Meanwhile, Democrats are focusing on healthcare subsidies and budget talks, which could further slow movement on crypto legislation.
Even with the uncertainty, there is still momentum behind the bill, which is considered crucial for the U.S. crypto sector. If enacted, it would define the regulatory responsibilities of the SEC and CFTC, set standards for DeFi, and help establish the U.S. as a leader in digital asset innovation. As
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