As the election season intensifies, the progress of crypto legislation in Congress has largely shifted behind the scenes. Despite several policy wins, the major crypto bills have yet to make significant public strides. The focus now is on the potential legislative directions, with time running short and the election dominating the political landscape.
Crypto to take over US elections?
Market structure legislation appears to be at the forefront among the bills still under consideration. According to Bloomberg, Senator Debbie Stabenow has revived her crypto market structure legislation efforts. Although many details remain unclear, the urgency is palpable, and it does not seem to be a straightforward continuation of FIT21, indicating that more time will be needed to finalize the bill.
Stabenow’s efforts are particularly noteworthy due to Senate Majority Leader Chuck Schumer’s support, labeling the effort as “reasonable regulation.” Schumer’s backing is crucial, given that Senate floor time is extremely valuable, especially with limited time before the election.
There is speculation that Stabenow’s effort may be linked to the Digital Commodity Consumer Protection Act (DCCPA) from 2022. However, this is merely conjecture, and it is unlikely to be a direct replication due to the evolving market dynamics since its initial introduction. One such factor in the DCCPA’s previous demise was the inclusion of decentralized finance (DeFi) within its scope.
What’s next?
DeFi remains a contentious issue in legislative discussions. While the European Union has opted to address DeFi separately, many in Washington, D.C., feel the necessity to regulate every sector of the crypto market to avoid leaving any aspect unregulated.
The looming election further complicates the legislative timeline. Historical precedents, such as the stablecoin bill from two years ago, illustrate how political momentum can dissipate, leading to delays and restarts in subsequent sessions.
The balance of power in Congress next year will influence these legislative efforts. Minority parties, anticipating a win in the upcoming elections, might delay active legislation, hoping to push their agenda once in power. Conversely, the current majority might rush their priorities before a potential shift in power.
Election outcomes are notoriously unpredictable, and both parties have made strategic miscalculations in the past. For instance, many Democrats anticipated a win for Hillary Clinton in 2016, and House Republicans expected a majority in 2022, affecting legislative strategies.
