• A landmark crypto market structure bill cleared a Senate committee, advancing to a floor vote for the first time.
  • The measure aims to split regulatory authority between the CFTC and SEC, with bipartisan support signaling potential momentum.
  • Industry groups hailed the vote as a critical step, though amendments on DeFi and stablecoins remain points of contention.

Breaking the Logjam

In a historic move, the Senate Banking Committee voted 14-10 on Thursday to advance the Lummis-Gillibrand Responsible Financial Innovation Act, a comprehensive bill that would define federal oversight of digital assets. The legislation, which had stalled for over two years, now heads to the full Senate for consideration—a milestone that proponents say could reshape the U.S. crypto landscape.

The bill establishes the Commodity Futures Trading Commission (CFTC) as the primary regulator for digital commodities, while the Securities and Exchange Commission (SEC) retains authority over tokens deemed securities. It also sets registration requirements for exchanges, brokers, and issuers, and includes provisions for stablecoin regulation and decentralized finance (DeFi).

Bipartisan Breakthrough

The vote saw all 13 committee Democrats and one Republican—Senator Cynthia Lummis, a co-sponsor—support the bill, with 10 Republicans opposed. “This is about providing clarity for American innovation while protecting consumers,” Lummis said after the vote. She acknowledged the bill is “not perfect” but called it “a starting point for debate.”

Senator Sherrod Brown, the committee chair, emphasized consumer safeguards. “We can’t let the Wild West of crypto continue without rules,” he said. Opponents, led by Senator Tim Scott, argued the bill gave too much power to the CFTC and could weaken SEC enforcement. “We need a framework that actually works, not one that picks winners and losers,” Scott said.

Industry Cheers, Cautions

The crypto industry reacted swiftly. Coinbase’s chief policy officer called it “a watershed moment,” while the Blockchain Association praised the “bipartisan effort.” However, some groups urged caution. The DeFi Education Fund noted that amendments on DeFi protocol liability and algorithmic stablecoins could be added during floor debate. “The devil is in the details,” said Miller Whitehouse-Levine of the DeFi Education Fund.

Treasury and market signals were mixed: Bitcoin rose 3% following the news, while Ether held steady. Analysts say the bill’s path remains uncertain, given a crowded Senate calendar and opposition from some financial regulators.

What’s Next

The bill now awaits a floor vote, though no date has been set. A companion bill in the House, the Financial Innovation and Technology for the 21st Century Act, passed in July with bipartisan support but hasn’t moved in the Senate. If the Senate passes its version, the two chambers would need to reconcile differences. The White House has not taken a formal position, though Treasury officials have raised concerns about regulatory gaps.

Correction: An earlier version of this article misstated the vote margin. The correct tally is 14-10, not 14-9.