Virtual Asset Regulation Bill Stumbles on 'This Clause' ..."Block Lawmakers' Coin Trading First"

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The U.S. cryptocurrency market structure bill, introduced to establish a clear regulatory framework for the U.S. virtual asset industry, has encountered new hurdles within Congress.

According to a report by CoinGeape, a virtual asset specialized media outlet, on April 27 (local time), Senate Democrats are strongly demanding the inclusion of strict ethics regulations in the bill. The Democratic Party's stance is that public officials with legislative power should be prohibited from directly trading or holding virtual assets they regulate. They emphasized the need to establish legal mechanisms, in cooperation with the Department of Justice (DOJ), to prevent conflicts of interest among public officials.

Republicans, who are leading the bill's passage, expressed concern that additional provisions could dilute the bill's essence and slow down the legislative process. The U.S. cryptocurrency market structure bill primarily aims to distinguish whether virtual assets are securities and to clarify the jurisdictions of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). Industry experts anticipate that the conflict between the two parties over the introduction of ethics regulations will be prolonged. Consequently, the prevailing analysis is that the likelihood of the bill being finally approved this year has decreased.

James Seyffart, an analyst at Bloomberg Intelligence, analyzed this conflict as an inevitable clash arising during the process of adjusting the bill's details. Seyffart added that as political interests become complexly intertwined, the regulatory vacuum for virtual assets could last longer than expected. Currently, U.S. virtual asset companies are struggling with business expansion and investment attraction due to the lack of clear legal grounds.

Amid ongoing power struggles among regulatory authorities, legislative delays in Congress are a key factor exacerbating market uncertainty. The fate of the U.S. cryptocurrency market structure bill depends on the acceptance of the ethics clause proposed by the Democratic Party and the compromise reached between the two parties. Virtual asset market participants are closely monitoring the situation, evaluating this legislative process as a significant turning point that will determine the regulatory environment within the U.S.

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