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A long, long journey

The narrative

Recently, Senate Majority Leader Chuck Schumer (D-N.Y.) expressed his intention at a “Crypto4Harris” virtual gathering to guide cryptocurrency legislation through Congress and have President Joe Biden approve the bill by the close of 2024. This statement appears audacious, and initially, it seems challenging to fulfill such a commitment.

Why it matters

As an analyst, I’ve been advocating for years that the U.S. should enact industry-specific regulations to provide clarity for companies operating within the cryptocurrency sector. This would allow them to confidently develop, issue tokens, manage blockchain networks, or perform other operations without the constant fear of regulatory intervention. To date, the closest we’ve come is the Financial Innovation and Technology for the 21st Century Act, a bill backed by Representative Patrick McHenry from North Carolina in the House of Representatives. However, with the dwindling number of working days left this year, it seems unlikely that crypto-related legislation will pass through the Senate. Here’s what might transpire and some potential hurdles to watch out for.

Breaking it down

At the SALT Wyoming Symposium last week, Senators Cynthia Lummis (R-Wyo.) and Tim Scott (R-S.C.) proposed a theoretical approach for passing crypto legislation. The suggested route, as per these politicians, involves the Senate Agriculture Committee, which primarily deals with commodities law. Notably, Senator Debbie Stabenow (D-Mich.), who heads this committee, has been drafting legislation in this area, though she hasn’t officially presented her bill yet.

If a bill passes through this committee, as Lummis explained, it might evolve into what’s known as an “omnibus bill,” where legislators can attach additional amendments or provisions to it. These could encompass various pieces of legislation such as the SAFER Banking Act, stablecoin regulations, and other related matters.

However, enacting any law faces numerous challenges, such as the shortage of remaining workdays on this year’s legislative schedule.

Lummis remarked during the SALT conference that it’s astonishing how little is left following the election. Furthermore, a significant part of the remaining period is expected to be dedicated to addressing critical pieces of legislation such as the yearly National Defense Authorization Act and budget bills.

It’s quite plausible that a cryptocurrency provision could be integrated into one or more of these bills, according to what I was told by a legislative staffer following Schumer’s comments. This idea was also expressed by Scott during his speech in Wyoming.

He mentioned that with the right motivation and rewards, you can achieve a great deal in a short amount of time.

The main concern is whether any cryptocurrency regulations will gain sufficient backing to:

Although cryptocurrency receives some backing from both political parties in Congress, it remains uncertain whether it carries sufficient importance over the numerous other matters Congress is currently handling. For instance, the end of the fiscal year is approaching quickly, which is a significant concern for lawmakers as they will likely prioritize this issue first when voting.

Despite some reservations, everyone I’ve talked to lately seems quite hopeful – if not for this year, then definitely next year – that the legislation will progress. The significant stride FIT21 made in passing through the House with bipartisan backing is a key reason for this optimism. Additionally, the increased focus on crypto matters by lawmakers compared to previous years also contributes to this positive outlook.

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If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at nik@coindesk.com or find me on Twitter @nikhileshde.

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See ya’ll next week!