Legislation that could fully insert the U.S. crypto industry into the regulated financial system has emerged in its latest form, with the Senate Banking Committee unveiling the text of the Market Structure bill just after midnight on Tuesday, ahead of this week’s hearing expected to advance the effort.
The latest version won’t offer many surprises to the crypto industry that has already had a chance to review it privately, but it does include still-controversial language on stablecoin yield and maintains legal protections for decentralized finance (DeFi) developers, keeping this corner of the crypto sector happy (so far).
Even if its approval in committee would constitute a major step forward, long blocked, the arrival of the bill on President Donald Trump’s desk is far from assured. Action this week would make it possible to maintain the possibility of adoption, even if a number of other obstacles remain, notably the insertion of an ethics provision which is not yet present in this project.
The conflict of interest section that would theoretically limit government officials from profiting from the crypto industry is outside the banking panel’s purview, so it will have to be included in legislation later. This is a controversial issue because its origins stem from President Donald Trump’s crypto interests, but White House officials have repeatedly said they will not tolerate a bill that targets the president. Meanwhile, Democrats will not allow the bill to move forward without such a section, Sen. Kirsten Gillibrand said last week at Consensus Miami 2026.
On the same stage in Miami, White House crypto adviser Patrick Witt said the current negotiating posture is to establish rules that apply “at every level, from the president all the way down to the newest intern on Capitol Hill,” but rejects anything that singles out a particular position or office holder.
That ethics piece, however, remains on hold until the Senate committee can vote to approve the rest of the bill during its hearing on Thursday.
The newly released text includes the political terrain that lobbyists have spent months fighting over – the question of what kind of yield would be acceptable for stablecoins. The outcome may have been settled for the committee’s negotiators, but bankers who view stablecoins as a threat have launched a final assault to revamp the outcome.
Over the weekend, industry lobbying groups asked their members to make a final push to lawmakers to further limit stable rewards programs.
At the same time, a study released last week by Galaxy claimed that trillions of dollars of foreign capital would flow into the U.S. financial system, easily offsetting any domestic disruption to deposits. The report “suggests that a majority of stablecoin growth will come from abroad, meaning that foreign capital will flow into the U.S. banking infrastructure at a rate that materially exceeds any migration of domestic deposits.”
The legislation still includes a section corresponding to DeFi’s Blockchain Regulatory Certainty Act, which protects software developers who don’t control people’s money from being treated as money transmitters, as well as a number of other demands from DeFi advocates.
“We are encouraged by the direction of recent negotiations and note that the most important provisions for developers and infrastructure providers – the BRCA and protections under the Exchange Act – are in this bill,” the DeFi Education Fund said through a spokesperson, adding that organizations will monitor the amendments this week and report those opposing the sector.
Meanwhile, on Monday, Punchbowl News reported an agreement among Senate lawmakers to address law enforcement needs in the Clarity Act, specifically authorization for prosecutors to pursue crypto misdeeds on the money laundering front.
The White House’s Witt said last week that the administration was aiming for completion of the Clarity Act by July 4, although Sen. Gillibrand predicted it would be completed by the first week of August.
Before that, Senate negotiators would still have work to do on the bill once it moves past the committee stage. Assuming the Clarity Act receives committee approval, it would still have to be merged with a similar version approved earlier by the Senate Agriculture Committee.
Then, lawmakers must also resolve the tricky conflict of interest provision before a final version is likely to be available for a vote by the full Senate, where 60 votes will be needed — necessarily including a significant number of Democrats. So far, progress in the Senate depends on the Republican Party vote, but other crypto efforts have typically achieved major bipartisan support when final votes take place.
Last year, the Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 (GENIUS) Act passed 68-30 in the Senate, easily meeting the minimum.
Read more: Banking groups intensify fight over stable coin yield ahead of Senate vote
