Crypto Market's Fate to be Decided in 14 Days... US Cryptocurrency Bill Deadline is May 21st

▲ Financial Market Regulation/ChatGPT Generated Image

The US cryptocurrency market structure bill has entered its final legislative phase, ending a nine-month stalemate. At the same time, the virtual asset market faces a critical turning point that will simultaneously shake up the regulatory landscape and capital flows over the next 14 days.

Louis Raskin, host of the cryptocurrency YouTube channel Coin Bureau, stated in a video released on May 6 (local time) that the US cryptocurrency market structure bill has entered full legislative procedure, spurred by an agreement on key issues within the Senate Banking Committee. After senators agreed on major points of the bill on May 1, Bitcoin (BTC) surpassed $80,000 for the first time since February. Raskin warned that if the bill is not processed before the Memorial Day recess on May 21, the establishment of a virtual asset regulatory framework in the US could be delayed until 2030 due to the election schedule.

The core of this agreement is Section 404, which deals with stablecoin yields. This provision faced difficulties due to opposition from the banking sector but eventually reached a compromise that allows staking rewards, liquidity provision profits, and loyalty program benefits. This significantly increases the likelihood that Coinbase's USDC revenue model and Athena (ENA)'s synthetic dollar revenue structure will receive legal protection. Coinbase CEO Brian Armstrong welcomed the agreement on the day of its announcement, stating, “Let's proceed with the vote,” and the market immediately reacted to the possibility of key revenue models in the virtual asset industry entering the institutional framework.

Opposition from traditional financial institutions is intensifying. Five financial groups, including the American Bankers Association (ABA), issued a joint statement on May 4, arguing that up to $1.3 trillion in deposits could flow out into stablecoins by 2028, and moved to block the bill. JP Morgan Chairman Jamie Dimon has publicly criticized Bitcoin as a fraud, but internally, the company has been pursuing the development of tokenized products. Raskin analyzed that the banking sector's investment of $56 million in lobbying funds demonstrates the existing financial sector's sense of crisis regarding the new virtual asset financial system.

The non-custodial developer protection provisions in Section 604 are also attracting market attention. This provision prevents developers who write smart contract code from being classified as money transmitters or financial intermediaries, thereby providing a basis for developers to build non-custodial infrastructure without risk of penalty. Currently, the proportion of US-based developers is only 19%, with a significant number of talents relocating to Dubai and Singapore. Raskin evaluated this provision as a key variable in determining where the center of the DeFi ecosystem will be.

The market variable is whether the Senate Banking Committee will vote before May 21. Analysis suggests that if the bill passes, Circle's market capitalization could further increase by more than 65% from its current level, but if processing is delayed, the pre-priced expectations could quickly fade, leading to price corrections. On May 1 alone, Bitcoin recorded $630 million in spot ETF inflows, creating a downside support base. Over the next 14 days, the actions of Senate Banking Committee Chairman Tim Scott and changes in Polymarket's approval probability have emerged as key indicators of virtual asset market volatility.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*