Senate crypto bulls face make-or-break test as Coinbase pulls bill support

The Senate Banking Committee shelved its crypto market structure bill after Coinbase withdrew support, as Wall Street banks, ethics fights and partisan splits left no clear path to a markup.

The Senate Banking Committee canceled a scheduled markup hearing on cryptocurrency market structure legislation, according to an announcement by Committee Chairman Tim Scott.

The postponement followed Coinbase’s public withdrawal of support for the bill. Scott announced the decision late in the day, stating no new timeline has been established for reconsidering the legislation.

“We aim to create a clear framework that protects consumers, strengthens national security, and ensures the future of finance is built in the United States,” Scott stated, according to reports. The chairman indicated discussions continue with the cryptocurrency sector, financial institutions, and senators from both parties.

Scott acknowledged uncertainty about whether disagreements in negotiations could be resolved quickly, according to the statement.

The bill has encountered opposition on multiple fronts. Wall Street banks lobbied against provisions allowing stablecoin yield programs, arguing such products threaten traditional banking operations, according to reports. The banking sector’s efforts convinced senators from both parties to oppose the measure.

Scott reportedly faces uncertainty about securing support from all Republican members of his party for the legislation.

Democratic lawmakers raised concerns about ethics regulations that would restrict high-ranking public officials from profiting personally from cryptocurrency sector activities. Those proposals were rejected by the White House, according to reports. Scott stated the matter falls under the jurisdiction of the Senate Ethics Committee rather than the Banking Committee.

The cryptocurrency industry has conducted extensive lobbying efforts and campaign spending over several years to advance regulatory legislation.

The Senate Agriculture Committee is expected to consider similar legislation later this month. The Banking Committee has taken a leading role in developing comprehensive cryptocurrency regulations in the United States.