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WASHINGTON, May 14 — The Republican-controlled Senate Banking Committee is preparing to review a major cryptocurrency regulation proposal on Thursday, marking a significant moment for the U.S. digital asset industry after years of debate and lobbying.
The proposed legislation, known as the Clarity Act, aims to establish clearer rules for cryptocurrencies by defining which regulators oversee different types of digital assets. The committee’s “mark-up” session — where senators debate amendments and vote on whether to advance the bill — is being closely watched as a key test of bipartisan support.
For the bill to move successfully through the full Senate, Republicans will likely need backing from at least seven Democrats. However, several Democratic lawmakers remain skeptical, arguing that the proposal does not go far enough in addressing anti-money laundering safeguards and concerns over public officials benefiting financially from crypto-related businesses.
Senator Elizabeth Warren, the committee’s leading Democrat, has warned that the legislation could create risks for national security and the broader financial system.
Political analysts say Democratic support will determine the bill’s future. Brian Gardner, chief Washington policy strategist at Stifel, noted that if the measure advances strictly along party lines, its chances of becoming law this year would remain limited.
The cryptocurrency industry has spent years advocating for clearer regulations, arguing that uncertainty has slowed innovation and adoption in the United States. Supporters of the legislation say the bill would clarify when digital tokens should be classified as securities, commodities, or other financial instruments — an issue that has long created tension between regulators and crypto firms.
The industry also invested heavily in the 2024 U.S. elections, reportedly spending more than $119 million to support pro-crypto candidates and promote legislation favorable to digital assets, including rules for stablecoins — cryptocurrencies pegged to traditional currencies such as the U.S. dollar.
Miller Whitehouse-Levine, chief executive of the Solana Policy Institute, described the Senate review as the result of years of effort to establish a clearer regulatory framework for digital assets.
Meanwhile, banking groups continue to oppose parts of the legislation, particularly provisions related to stablecoins. Banks argue the bill could allow crypto firms to compete more aggressively for customer deposits by offering rewards tied to stablecoin holdings. The American Bankers Association has urged member banks to pressure lawmakers to tighten the bill’s language before any final vote.
