US senators are introducing a long-awaited bill to define the rules for the crypto market

U.S. senators late Monday unveiled a draft bill that would create a regulatory framework for cryptocurrency that, if signed into law, would clarify financial regulators’ jurisdiction over the fast-growing sector, potentially boosting the adoption of digital assets.The crypto industry has long pushed for such legislation, often arguing that it is “existential to the” future of digital assets in the US and necessary to solve fundamental, long-standing problems for crypto companies.

The legislation would, among other things, define when crypto tokens are securities, commodities or otherwise, bringing long-awaited legal clarity to the sector.It would also give the US Commodity Futures Trading Commission – the industry’s regulator of choice, as opposed to the US Securities and Exchange Commission – the authority to oversee crypto markets.The bill also gives the banking industry a solution they sought to create a federal regulatory framework for dollar-pegged crypto tokens, called stablecoins.

Bank lobbyists had urged Congress to close what they said was a loophole in the bill that allowed intermediaries to pay interest on stablecoins. Banks have argued that this would lead to a flight of deposits from the insured banking system, potentially threatening financial stability.

Crypto companies have pushed back against this claim, claiming that banning third parties, such as crypto exchanges, from paying interest on stablecoins would be anti-competitive. The bill — which could change as senators consider amendments — prohibits crypto companies from paying interest to consumers solely for owning a stablecoin. However, it does allow crypto companies to pay rewards or incentives to customers for certain activities, such as sending a payment or participating in a loyalty program.The SEC and the CFTC should also issue a joint rule requiring clear disclosures from crypto companies about rewards paid in connection with the use of stablecoins. Trump has courted the industry with cash and promised to be a “crypto president,” and his family’s own crypto ventures have helped push the sector into the mainstream.

The industry spent heavily during the 2024 elections to promote pro-crypto candidates in hopes of passing this landmark market structure bill. The House of Representatives passed its version of the bill in July, but talks stalled in the Senate last year, with lawmakers divided over anti-money laundering provisions and requirements for decentralized finance platforms, which allow crypto users to buy and sell tokens without an intermediary, according to three sources familiar with discussions. With Congress already focused on the 2026 midterm elections, in which Democrats could capture the House of Representatives, some lobbyists are skeptical that the crypto market structure bill could become law.

That would leave crypto companies relying on regulatory guidelines that could be rolled back under a future administration, industry executives say.