U.S. Faces Urgency to Pass Crypto Market Structure Bill, Warns White House Advisor

• U.S. crypto bill faces delays, urgent action needed for clarity.
• White House advisor warns against future restrictive crypto legislation.
• Coinbase withdraws support, pushes for improvements in crypto bill.

The U.S. is at a critical juncture regarding the crypto market structure bill, according to Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets. Witt stressed the need for prompt action to pass the bill before it loses momentum under the current pro-crypto administration. In a recent post on X (formerly Twitter), Witt echoed the sentiment shared by Coinbase CEO Brian Armstrong, who withdrew support for the bill, citing concerns over its provisions.

Witt, a key White House advisor on crypto policy, argued that the bill’s passage is urgent to avoid allowing future legislation that could be more restrictive. “No bill is better than a bad bill,” Witt wrote, referencing President Trump’s previous support for crypto-friendly policies. He expressed concern that without timely action, the crypto community may face tougher regulations in the future if Democrats push through punitive measures in response to a potential financial crisis, similar to the aftermath of the Dodd-Frank Act.

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Witt’s comments come amid delays in the crypto legislation, largely driven by disagreements over specific aspects of the bill. Coinbase, a significant supporter of the Trump administration, expressed concerns over language in the bill that could limit key areas of the crypto market, such as tokenized equities, decentralized finance (DeFi) privacy, and stablecoin yield. This disagreement led to the postponement of the Senate Banking Committee’s markup hearing, despite initial expectations that the bill would be fast-tracked.

Despite withdrawing its initial backing, Coinbase reaffirmed its commitment to working on the bill’s improvement. Coinbase CEO Brian Armstrong stated that he would engage with bank executives at the World Economic Forum in Davos to address concerns around stablecoin yield, which U.S. banks strongly oppose.

Navigating the Crypto Regulatory Landscape

The urgency of passing the crypto market structure bill is heightened by the increasing regulatory uncertainty in the U.S. The current friction between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) has left the industry in a state of ambiguity regarding which agency has jurisdiction over crypto assets. Witt emphasized that the bill is crucial in providing clarity and resolving this jurisdictional confusion, offering much-needed regulatory certainty to an industry that has been operating under an unclear framework.

Witt’s call for action reflects a broader sentiment in the industry that a clear legal framework is essential for fostering innovation and attracting investment in the crypto sector. While compromises are expected as lawmakers work to refine the bill, the key question remains whether a balanced approach can be reached that addresses the concerns of industry leaders without overregulating the sector. With the Senate Agriculture Committee’s markup hearing scheduled for Jan. 27, the crypto community will be watching closely to see how the bill evolves.

In the face of ongoing debates, industry stakeholders and legislators agree that a comprehensive crypto bill is necessary to establish a fair regulatory environment for the rapidly growing digital asset market.

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