New Senate Bill Brings Long-Awaited Protections For Crypto Developers

U.S. lawmakers are accelerating efforts to lock in long-awaited protections for cryptocurrency developers as Washington races towards passing sweeping digital asset legislation in early 2026.

Specifically, senators Cynthia Lummis and Ron Wyden have introduced the Blockchain Regulatory Certainty Act (BRCA), a standalone bill designed to ensure that blockchain developers and infrastructure providers are not treated as money transmitters simply for writing code or maintaining decentralized networks.

The proposal arrives as Congress prepares to advance a broader crypto market structure bill, which includes similar protections and is headed for markup in the Senate Banking Committee later this month.

Ending the “Developer as Bank” Narrative

At the center of the legislation is a clear legal distinction, where developers who do not custody, control, or move user funds should not fall under federal or state money-transmission laws.

Under the BRCA, non-custodial software developers and infrastructure providers would not be classified as financial intermediaries solely for writing or publishing blockchain software, maintaining distributed ledger networks, providing infrastructure for self-custody wallets, or supporting decentralized applications (dApps).

As Senator Lummis said:

“Writing code is not the same as controlling money, and developers who build blockchain infrastructure without touching user funds shouldn’t be treated like banks. Ron Wyden and I are ensuring that won’t happen.”

The bill seeks to reverse years of regulatory uncertainty that many in the industry believe has driven innovation offshore and exposed developers to legal risk simply for maintaining open-source systems.

Response to Rising Legal Pressure

The move follows mounting concern across the crypto sector after high-profile prosecutions of open-source developers, including the cases against Tornado Cash developers Roman Storm and Alexey Pertsev.

Those cases sent shockwaves through the industry, raising fears that the authorities could hold programmers criminally liable for how third parties use their software.

In a statement, Lummis warned that treating developers as financial institutions “makes no sense when they never touch, control, or have access to user funds,” adding that overly aggressive enforcement threatens to push the next generation of financial infrastructure out of the U.S. entirely.

Industry Backs the Bill

Crypto advocacy groups quickly threw their support behind the BRCA.

The DeFi Education Fund called the proposal “critical protections for software developers of non-custodial, decentralized technologies,” while the Blockchain Association said the bill is essential to preserving innovation in the U.S.

In an X post on January 12, Paradigm’s vice president of government affairs, Alexander Grieve, described the bill as “crucial legislation to support US blockchain development.”

Market Structure Bill Gains Momentum

The BRCA’s protections are also mirrored in the wider crypto market structure bill, which is moving toward markup in the Senate Banking Committee. The Senate Agriculture Committee, which also oversees parts of the legislation, has delayed its hearing until the final week of January to secure broader bipartisan backing.

While draft provisions can still go through amendments or removals, lawmakers are under pressure to deliver regulatory clarity after years of stalled crypto legislation.

If passed, the combined framework would represent the most comprehensive crypto regulatory overhaul in U.S. history, defining token classifications, stablecoin rules, and now, developer protections.

Turning Point for U.S. Crypto Policy

Meanwhile, supporters argue the bill could mark a turning point for American crypto innovation, giving developers the legal certainty they need to build next-generation financial infrastructure at home. Indeed, as the Blockchain Association said:

“Clear rules are essential for innovation to thrive in the U.S., and it’s critical that the Blockchain Regulatory Certainty Act (BRCA) remains in market structure legislation.”

With multiple crypto bills now advancing simultaneously, January 2026 is shaping up to be one of the most consequential months in U.S. digital asset regulation.

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