U.S. Senate Banking Committee Receives Over 100 Amendments to CLARITY Crypto Bill

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• More than 100 amendments were filed ahead of the Senate Banking Committee’s markup of the crypto market structure bill.
• Stablecoin yield restrictions, crypto software developer protections, and ethics provisions are among the main issues addressed.
• Senator Elizabeth Warren reportedly submitted more than 40 amendments.
• Senator Jack Reed proposed amendments related to stablecoin restrictions and banning crypto as legal tender for tax payments.
• Republicans hold a Senate majority but may require Democratic support to advance the legislation.

Senators File Amendments Ahead of Senate Crypto Bill Markup

Members of the U.S. Senate Banking Committee have submitted more than 100 amendments to a crypto market structure bill scheduled for markup on Thursday, according to a list obtained by POLITICO. The proposed amendments primarily concern stablecoin regulations, protections for crypto software developers, ethics provisions, sanctions, and institutional involvement in digital assets.

Democratic senators introduced dozens of proposed changes, while Republican senators largely sought narrower adjustments to the legislation. The bill aims to establish how U.S. market regulators oversee the cryptocurrency industry. The House previously passed a related version of the legislation in July known as the CLARITY Act. The Senate Banking Committee had indefinitely delayed an earlier markup in January after Coinbase withdrew support for the bill.

Stablecoin Yield Restrictions Remain Key Issue

One of the most debated sections of the legislation concerns restrictions on stablecoin yield offerings. Banking and crypto industry groups have reportedly spent months negotiating the issue without reaching an agreement.

A version of the bill released Monday prohibited third-party platforms, including crypto exchanges, from offering stablecoin yield products that are considered “functionally equivalent” to interest-bearing bank deposits. According to the amendment list, Democratic Senators Jack Reed and Tina Smith proposed strengthening the restriction by replacing the “equivalence” standard with a “substantially similar” test.

Brendan Pedersen, a senior reporter, stated that the amendment would incorporate banking industry changes to stablecoin yield restrictions. Democratic Senator Catherine Cortez Masto also proposed an amendment aimed at protecting software developers by creating a safe harbor from criminal liability for failing to register as a money transmitter.

Additional Amendments Target Crypto Legal Tender and Federal Reserve Access

Crypto journalist Eleanor Terrett reported that Senator Elizabeth Warren submitted more than 40 amendments to the legislation. One proposed amendment would prevent the Federal Reserve from granting master accounts to crypto companies.

Senator Elizabeth Warren also criticized the latest version of the legislation for not including provisions addressing conflicts of interest tied to public officials and cryptocurrency ventures. In a statement released ahead of Thursday’s markup, Warren said the bill “includes zero provisions” to prevent conflicts involving President Donald Trump and his family’s crypto activities. Senator Jack Reed also introduced an amendment that would prohibit cryptocurrencies from being used as legal tender, including for tax payments. Additional amendments address sanctions, institutional participation in crypto activities, and enforcement measures.

Democratic Senator Andy Kim proposed reestablishing the Justice Department’s National Cryptocurrency Enforcement Team, which was dismantled in April last year. Republicans currently hold a majority on both the Senate Banking Committee and in the Senate. However, some Republican senators, including Senator Thom Tillis, have indicated they may not support the bill without specific provisions. The legislation may also require support from some Democratic senators to achieve the three-fifths majority needed to end debate on the Senate floor.