Time Running Out for Crypto Clarity

The crypto market structure bill has seen little public progress over the past month, making its prognosis difficult. However, it's evident that time is running out for its passage. You're reading State of Crypto, a newsletter by CoinDesk that explores the intersection of cryptocurrency and government. To receive future editions, click here to sign up. Vote Watch The Narrative It's unlikely that the crypto market structure bill will be passed this month, but this doesn't mark the end of the process. The timeline is, however, approaching a critical point that will likely increase the pressure on stakeholders. Why It Matters Many recent developments related to market structure issues, such as statements from the Securities and Exchange Commission staff, are not permanent and can be changed. The SEC has the time to create rules that will go through a notice-and-comment period, but this will take time. The market structure legislation aimed to solidify crypto industry goals and regulations into law, making it more challenging for future administrations to reverse these rules. In other words, without the Clarity Act, it's possible that we'll be having the same conversation in a few years. This is not an endorsement of the bill but rather a statement of a likely future scenario. Breaking It Down Memorial Day, May 25, has been considered a "drop-dead" date for legislation to advance since at least December last year. As summer approaches, lawmakers will leave town to focus on their campaigns and won't have the time to worry about the crypto bill or other legislation. Before Congress leaves, it will need to address a bill to fund the Department of Homeland Security and decide whether Kevin Warsh will become the next Federal Reserve chair. Jesse Hamilton from CoinDesk outlined the necessary steps to get Clarity signed into law by President Donald Trump last week. The crypto industry is eager for this bill, with over 100 companies signing an open letter urging a markup hearing in the Senate Banking Committee, which would be the first step toward overall passage. However, it's unclear how close the committee is to moving forward. While stablecoin yield dominates the conversation, other outstanding issues remain unresolved. Even after these issues are resolved, the House will need to vote on the bill again. Congressman French Hill, who chairs the House Financial Services Committee, told CoinDesk that many of the outstanding issues around sales practices for stablecoins and decentralized finance had already been addressed by the House in its version of the bill. He believes the Senate should be able to find common ground. "I think the Senate has built upon the House's work on both FIT21 and CLARITY," he said. "You can see that in the Senate Agriculture markup and the basic draft of many components in the Senate bill." We'll be discussing this topic further at Consensus Miami next month. This Week If you have thoughts or questions about what to discuss next week or any other feedback, feel free to email me at nik@coindesk.com or find me on Bluesky @nikhileshde.bsky.social. You can also join the group conversation on Telegram. See you all next week.