Key Takeaway
Senate Republicans are split over a major Digital Asset Market Structure Bill, as Senator John Kennedy warns the committee is not yet prepared to advance it.
With Donald Trump back in the White House, optimism around the U.S. emerging as a global crypto hub has been on the rise.
Yet, that momentum is hitting hurdles in Congress, as Senate Republicans find themselves divided over a Digital Asset Market Structure Bill.
Senator Kennedy urges a word of caution
On the 10th of September, Sen. John Kennedy, a senior member of the Banking Committee, cautioned that the panel isn’t ready to advance the bill.
He cast doubt on Chairman Tim Scott’s timeline to push the bill forward by the end of September.
When asked about advancing the bill this month, Sen. Kennedy responded,
“I don’t think we’re ready. People that I talk to still have a lot of questions. I know I still have a lot of questions.”
He has raised concerns that the proposed Digital Asset Market Structure Bill, designed to split digital asset oversight between the SEC and CFTC, might hand excessive influence to the crypto industry.
However, his stance contrasts sharply with Chairman Tim Scott and other Republicans, who argue that establishing a clear, bipartisan framework is long overdue and remains a top priority.
Chairman Tim Scott’s retort
Commenting on the issue, Senator Tim Scott’s spokesperson, Jeff Naft, emphasized that this debate is far from new.
He pointed out that the original Responsible Financial Innovation Act, introduced by Senators Cynthia Lummis and Kirsten Gillibrand in 2022, has been under active review since June.
Lawmakers have received thousands of pages of feedback and engaged with around 160 stakeholders in preparation for a potential September markup.
Naft stated,
“The House has already acted, and the Senate should not fall behind.”
Despite growing momentum, the push for comprehensive crypto legislation on Capitol Hill is becoming increasingly fragmented.
What’s more…
After the House passed the CLARITY Act in July, Senate Republicans introduced the GENIUS Act over the summer to regulate stablecoins pegged to the U.S. dollar.
Meanwhile, Senate Banking Committee Chairman Tim Scott has spent months rallying support for a broader digital asset bill.
He worked with Republican colleagues Cynthia Lummis, Thom Tillis, and Bill Hagerty to release a set of guiding principles aimed at shaping the legislation.
These principles advocate for a dual regulatory framework, assigning oversight responsibilities to both the SEC and CFTC.
They also call for clearer asset classifications to distinguish between securities and commodities, and emphasize robust anti-money laundering rules designed to balance innovation with investor protection.
However, Sen. Kennedy dismissed these efforts as merely a “baby step” compared to the sweeping Digital Asset Market Structure Bill currently under debate.
Crypto industry’s response
Crypto industry leaders, including Coinbase’s Brian Armstrong, have strongly backed Scott’s September-end deadline, pouring millions into lobbying efforts for regulatory clarity.
Divisions have surfaced both within the Republican Party (GOP) and among Democrats, as Senator Andy Kim cautioned against rushing the legislative process.
Meanwhile, on the 9th of September, a group of 12 Senate Democrats unveiled their own competing framework.
They called for stricter disclosure requirements, mandatory platform registration, and restrictions to prevent lawmakers and their families from personally profiting from digital assets.
What’s ahead?
Amid these competing proposals, regulators are also stepping in.
Fresh joint guidance from the SEC and CFTC is set to broaden access to spot crypto trading, opening the door for traditional exchanges and brokerages to offer digital asset products directly.
Supporters argue this could accelerate mainstream adoption, but critics warn it further complicates an already fractured regulatory debate.
Thus, this growing divide casts uncertainty over whether the U.S. can finalize a market structure bill before peers like the EU and Singapore solidify their dominance in global crypto regulation.
