Crypto industry rebels against US bill it helped craft to regulate digital assets
Several major cryptocurrency firms and industry groups have publicly opposed a US congressional bill they previously supported to create a federal framework for digital asset regulation. The legislation—intended to clarify oversight between the SEC and CFTC and to set rules for stablecoins and token custody—has drawn criticism after industry stakeholders said last-minute changes expanded enforcement powers and imposed new compliance burdens. Key objections include broadened definitions that could sweep in previously exempt tokens, tougher anti-money-laundering requirements, and unclear treatment of decentralised finance (DeFi) protocols. Lobby groups and exchanges warned the revisions risk stifling innovation, raising costs for users, and prompting some firms to reconsider US operations. Lawmakers behind the measure argue the changes were meant to close loopholes and protect consumers. The dispute highlights growing friction between regulators, legislators and crypto firms over how prescriptive federal rules should be. Traders should watch legislative text, committee votes, and statements from major exchanges and stablecoin issuers for hints on policy direction and market reaction.
Bearish
Industry pushback against tighter federal rules increases regulatory uncertainty. When major firms publicly distance themselves from a bill they once supported, it signals that compliance costs and operational constraints may rise if the law passes in its current form. History shows that regulatory uncertainty tends to depress crypto markets in the short term—examples include price weakness after the SEC’s enforcement actions in 2020–2021 and volatility following the 2023 US stablecoin and exchange scrutiny. Short-term effects: increased volatility, risk-off positioning, outflows from US-listed crypto products, and downward pressure on tokens tied to US market sentiment (notably stablecoins and major exchange tokens). Long-term effects: if lawmakers adopt stricter, clearer rules that some firms can comply with, market confidence could recover; conversely, overly burdensome rules could drive activity offshore, fragment liquidity, and reduce capital inflows, which would be structurally negative. Traders should monitor legislative milestones, enforcement language, and public statements from top exchanges and stablecoin issuers to time positions and hedge regulatory risk.