The U.S. Senate made history on January 29 when the Agriculture Committee held the first-ever digital asset markup session for its Digital Commodity Intermediaries Act (DCIA). The DCIA largely focuses on clarifying the role of the Commodity Futures Trading Commission (CFTC), which reports to the Ag committee, in regulating digital assets that are commodities, not securities. Thursday’s markup session was a relatively efficient affair, with three proposed Democratic amendments—the ‘ethics’ question (more on this later); preventing fraud at crypto ATMs/kiosks; and prohibiting federal bailouts of bankrupt crypto firms—all swiftly voted down on strict party lines: all 11 Dems voting aye, all 12 Republicans voting nay. There was a palpable partisan urgency to move the bill forward, which was ultimately done by the same 12-11 party-line margin.
Before the voting began, several Dems, including the committee’s ranking member Amy Klobuchar (D-MN) and Cory Booker (D-NJ), commented on the partisan nature of the affair after what they felt were good-faith talks before the holidays that got them to this stage. Before the full Senate gets a chance to vote on market structure legislation, the Ag committee’s version will need to be reconciled with the Banking committee’s draft. But with both the banking and crypto sectors digging in their heels over the Banking draft’s stablecoin ‘yield v rewards’ language, a frustrated White House has begun applying pressure directly to this wound. On Wednesday, Reuters reported that the White House has summoned representatives from both sides for a meeting this Monday (Feb. 2).
Bloomberg reported that Coinbase will be among the companies representing the crypto side, but cautioned that the meeting could be delayed if the odds of compromise appear as slim as they do now. Following Coinbase’s withdrawal of support for CLARITY, the White House was said to be annoyed with the exchange’s last-minute grandstanding. Coinbase CEO Brian Armstrong denied these reports but has since spent a lot of time buttering up Trump. Right after Coinbase pulled its support for CLARITY, the White House crypto advisor Patrick Witt tweeted his displeasure, warning that crypto operators “might not love every part of the CLARITY Act, but I can guarantee you’ll hate a future Dem version even more.”
Witt stressed that he was addressing “both sides” of this debate, “not just exchanges.” But he reiterated his warning not to make the perfect the enemy of the good just because “there are one or two things in here that to any one individual player might be detrimental.” This week, Witt went further, saying passing market structure legislation will “require some folks to make difficult decisions that might hurt one part of their business but ultimately will allow the rest of their business to thrive.” The banks claim this “mass deposit flight” will negatively impact their ability to offer loans, with particularly negative impacts on smaller community lenders.
The crypto sector rubbishes this view, accusing banks of simply not enjoying the prospect of having to compete with crypto platforms for customers’ loyalty. Tether CEO Paolo Ardoino told The Block that the company wasn’t taking a firm position on the yield v rewards fight. Tether has been telling members of Congress that it supports the Banking draft’s yield restrictions. The ethics amendment that the Ag committee rejected would have prevented elected officials and their families from profiting off crypto ventures.
Elissa Slotkin noted that the committee’s GOP members would be having “a conniption” if it were former President Joe Biden earning nearly a billion dollars—as Trump’s family is estimated to have reaped from its crypto ventures in just the past 12 months—while simultaneously eliminating regulatory constraints on those ventures. Six Dem senators wrote a letter to Deputy Attorney General Todd Blanche on Wednesday pressing him on his decision last year to disband the Department of Justice’s National Cryptocurrency Enforcement Team (NCET) and terminate investigations and prosecutions into the tools used to facilitate cryptocurrency crime. The letter details Blanche’s crypto disclosures, which in January 2025 showed him owning “between $158,000 and $470,000, mostly in Bitcoin and Ethereum.” The senators have asked Blanche to respond to several questions on this subject by “no later than February 11.”
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