In brief
- Wall Street and crypto groups met privately Thursday to resolve disputes over the Senate’s crypto market structure bill.
- Sources say the "productive" meeting offered signs of progress on the thorny issue of DeFi.
- But the bill is set to face a key Senate vote in less than a week, and many are worried about getting a deal done in time.
A group of rival stakeholders met privately Thursday to hash out disagreements over crypto’s market structure bill, as the legislation hurtles towards a potentially make-or-break Senate vote penciled for next week.
The meeting, which has not been previously reported, included representatives of SIFMA, a major Wall Street trade group protesting key elements of the bill, and a handful of crypto industry representatives, according to sources with direct knowledge of the talks.
One source told Decrypt the meeting offered glimmers of “progress” on the thorny issue of decentralized finance, or DeFi, shorthand for the crypto-native applications that allow for the trading of assets without third-party intermediaries.
SIFMA has in recent weeks voiced objections to regulatory carve-outs in the bill for certain decentralized finance services and their developers, the source said. Another source characterized today’s talks as “constructive” and “productive” on the subject of DeFi.
One source said SIFMA has also been pushing, along with the banking lobby, to retroactively outlaw yield-generating, dollar-pegged stablecoins, which were tacitly permitted by the GENIUS Act—another piece of crypto legislation signed into law by President Donald Trump last summer.
When reached by Decrypt, a SIFMA representative denied that the group has yet “taken a position on yield-bearing stablecoins”—but did not comment on its purported DeFi-related concerns with the market structure bill.
At Thursday’s meeting, crypto policy leaders—including one representative of venture giant Andreessen Horowitz, and another from the DeFi Education Fund—attempted to convince SIFMA to moderate its requests, which have already been partially adopted by key pro-crypto Senate Democrats this week.
Both sides have little time to reach an agreement. Senate Banking Committee chair Tim Scott (R-SC) announced earlier this week that he plans to hold a crucial markup of the crypto bill next Thursday, despite concerns from industry leaders that such an accelerated timeline could blow up monthslong bipartisan negotiations over the legislation.
Most stakeholders agree that the bill needs to receive bipartisan support at next week’s committee markup to face any chance of ultimately getting passed on the Senate floor.
On Thursday, more than 50 members of crypto industry trade group The Digital Chamber met with senators and White House officials on Capitol Hill to push for favorable language in the final pre-markup draft of the bill, which is expected to land early next week.
A representative of the organization said stablecoin yield and protections for DeFi software developers—who have been criminally prosecuted by both Democratic and Republican administrations in recent years under existing money transmitter laws—were two of the main subjects raised during today’s meetings.
Nonetheless, the dynamics hanging over current negotiations—six days and counting to finalize a complex bill that could reshape the U.S. economy—have left some participants exasperated.
“I just can’t believe we finally have Democrats and Republicans proactively working on something and we are going to potentially jeopardize it for an arbitrary timeline,” one crypto industry insider told Decrypt on Wednesday.