Senators file key amendments ahead of crypto market structure bill markup

Senators have proposed several important amendments ahead of the historic final vote on a bill aimed at reforming the crypto market, as the Senate Agriculture Committee prepares to advance the legislation through its committee stage. 

With logistical hurdles, such as severe weather, mostly cleared and some of the bill’s more contentious provisions removed, the legislation appears poised to pass Thursday’s committee vote with little disruption.

However, other provisions on ethics, consumer protection, governance, and national security could continue to shape the bill’s path as lawmakers begin discussions on whether to send it to the full Senate. There are a few recent surprises: the Senate Agriculture Committee’s markup of the crypto market structure bill should run fairly smoothly. The recent heavy snow that blanketed Washington, D.C., has largely cleared, easing concerns about attendance and missed deliveries. 

Even more importantly, though, Senators Roger Marshall of Kansas and Dick Durbin of Illinois have indicated they would not pursue a proposed amendment on credit card swipe fees in the markup. Supporters of the crypto bill have embraced that move. 

Lawmakers advocate for ethics and consumer protections via amendments

Markup is expected to last approximately two hours. In this time frame, senators will consider and vote on a few modifications before deciding whether to send the bill to the Senate floor. Although the process may be orderly, the political calculus is not quite certain.

It also aims to limit or regulate the use of digital assets by public officials and close relatives, as described in other statements, a provision reflective of broader fears about the role-play of conflicts of interest in emerging markets. Minnesota Senator Amy Klobuchar, ranking Democrat on the Agriculture Committee, submitted two amendments. Both proposals would also delay the bill’s passage into law until the Commodity Futures Trading Commission (CFTC) has at least 4 confirmed commissioners. 

That would involve two appointees from the minority party, who were selected through consultation with the committee’s ranking minority member. Proponents of this move assert that a fully staffed, politically balanced regulator is required to justify the CFTC’s expansion of jurisdiction over crypto markets. Klobuchar’s second amendment concerns retail participation and consumer advocacy. 

It would expand the meaning of a “retail participant” and define the function of a proposed Digital Commodity Retail Advocate. Rather than merely supervising and overseeing registered intermediaries, the advocate’s role would be more precise, thereby better protecting the average person in the crypto market.

National security concerns shape broader crypto debates

Security measures were proposed to combat hostile states or other actors using digital asset platforms to compromise economic or national security interests. Ultimately, it is not clear which of these amendments will be debated or passed. Some are to be postponed to expedite the process, and some are to be included to reach wider backing. 

Meanwhile, activity is also picking up in the Senate Banking Committee. Senators have returned from recess, and cryptocurrency executives have returned from the World Economic Forum in Davos to the United States. 

It is unclear whether Coinbase’s chief executive officer has made any headway with major bank executives on stablecoin-related yield issues. Still, yield remains a central point of dispute and concern.

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