Major U.S. Crypto Regulation Bill Moves Closer To Senate Approval

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The Senate Banking Committee voted 15-9 to advance the CLARITY Act, pushing the long-debated crypto market structure bill closer to becoming law. The legislation would establish federal rules for digital assets and clarify whether cryptocurrencies fall under securities or commodities oversight. The vote marks the strongest bipartisan movement on crypto regulation in Washington after years of stalled negotiations and industry pressure.

Senate Vote Pushes Crypto Regulation Forward

As it happens, republican lawmakers on the committee unanimously backed the bill and were joined by Democratic senators Ruben Gallego and Angela Alsobrooks, according to a report from May 14.

The legislation now heads to the Senate floor, where negotiations are expected to continue around things like anti-money laundering provisions and decentralized finance (DeFi) protections.

Committee Chairman Tim Scott called the vote a major milestone for both the crypto industry and the broader US financial system, per a press release by the U.S. Senate Committee on Banking, Housing, and Urban Affairs published on May 14. As Scott said after the vote:

“Today, the Banking Committee showed the American people that Washington can still work together. We had a serious debate, worked through real differences, and came together around a shared goal: protecting consumers, supporting innovation, and keeping the future of finance in America.”

The CLARITY Act aims to create clearer oversight for digital assets by defining when tokens qualify as securities, commodities, or separate asset categories. Crypto firms have argued for years that unclear jurisdiction between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) has slowed innovation and pushed companies overseas.

The Senate markup came after months of negotiations and heavy lobbying from both the crypto and banking industries. Bank groups launched a last-minute effort to tighten stablecoin provisions in the bill, particularly around crypto firms offering rewards tied to stablecoin holdings.

Democrats Remain Divided On Crypto Bill

Despite the bipartisan vote, several Democrats warned they still have concerns about the legislation. Senator Elizabeth Warren argued the bill remains too favorable toward crypto companies and lacks stronger protections against financial crime and political conflicts of interest.

As she said during the hearing:

“Our job is not to advance a pro-industry crypto bill.”

At the center of negotiations were debates around ethics provisions regarding political officials profiting from crypto ventures, as well as the Blockchain Regulatory Certainty Act (BRCA), which would shield non-custodial developers from money transmitter rules.

The crypto industry has treated the CLARITY Act as one of its top legislative priorities after spending more than $119 million backing pro-crypto candidates during the 2024 election cycle.

Industry advocates say failure to pass the bill this year could significantly reduce its chances of becoming law if political control shifts after the midterm elections.