Sen. Lummis Says White House Rebuffed Ethics Language in Crypto Market-Structure Talks
Senator Cynthia Lummis (R-Wyo.), a lead negotiator on bipartisan U.S. market-structure legislation for digital assets, said the White House rejected ethics language she and Senate Democrats proposed. Speaking at the Blockchain Association policy summit, Lummis said Democrats want restrictions preventing senior officials from profiting from crypto businesses they oversee and assurances that Democratic nominees receive commission slots at the SEC and CFTC. The White House reportedly pushed the draft back for revision. Lummis expects negotiators to release a working draft by the end of the week and hold a markup next week. Senator Kirsten Gillibrand, Lummis’s Democratic counterpart, said the draft addresses issues beyond the House Clarity Act, including decentralized finance exchanges. The talks involve the Senate Banking and Agriculture committees; language is still evolving as industry stakeholders grow impatient with closed-door negotiations.
Neutral
The announcement is primarily procedural and political rather than a direct regulatory change, so immediate market-moving effects are limited. Key reasons: 1) Uncertainty over ethics language and nominee assurances prolongs legislative timeline but does not signal imminent restrictive or permissive rulemaking. 2) Markets typically react to concrete regulatory outcomes (votes, enacted statutes, agency rules). This update merely indicates negotiation friction; it increases policy uncertainty in the near term but is unlikely to trigger sustained directional moves. 3) If the final bill enshrines strict ethics limits or partisan commission appointments, that could weigh on institutional confidence (bearish). Conversely, a bipartisan market-structure bill clarifying SEC/CFTC roles could be bullish for adoption. Historically, reports of negotiation stalemates produce short-term volatility or muted trading as participants wait for clarity (neutral-to-cautious reaction). Traders should monitor draft release, committee markup, and specific provisions affecting custody, exchange definitions, DeFi and agency jurisdiction—those details will drive short-term spikes in volatility and longer-term structural shifts.