Comprehensive U.S. crypto market-structure bill could pass within months; stablecoin yield and DeFi are key disputes
White House adviser Patrick Witt and former House Financial Services chair Patrick McHenry said at the Ondo summit that a comprehensive U.S. crypto market-structure bill is accelerating and could reach the president within months. Drafting teams, brokered by the White House, are converting high-level principles into statutory text on a compressed timeline. Key negotiable issues center on stablecoin rules — notably whether centralized platforms may pay passive yield on users’ idle stablecoin balances — and banning deceptive marketing (for example implying FDIC insurance), where broad agreement exists. Banks oppose platform-paid stablecoin yields over concerns about deposit funding migration; crypto firms argue yields drive user engagement. McHenry warned that excluding DeFi and tokenized lending would undermine the framework, noting tokenized lending is cheaper than securities lending and reflecting strong market demand. Ethics provisions (such as restrictions affecting officials’ spouses) remain politically sensitive, but negotiators hope narrower compromises can win bipartisan support. For traders: watch provisions on stablecoin yield, the statutory treatment of DeFi and tokenized lending, and the bill’s timetable — each could materially affect liquidity, funding rates and stablecoin flows if enacted.
Neutral
The bill increases regulatory clarity, which is generally positive for markets over the long term, but the immediate price impact is ambiguous and depends on specific provisions. Key market-moving elements are: stablecoin yield rules, the statutory classification of DeFi/tokenized lending, and the bill’s timeline. If lawmakers ban centralized platforms from paying passive stablecoin yields, that could reduce on-exchange stablecoin balances and liquidity, tightening funding markets and potentially exerting short-term downward pressure on risk assets that rely on stablecoin liquidity (bearish for short term). Conversely, a balanced, clear framework that includes DeFi could boost institutional participation and product innovation, supporting higher valuations over the medium to long term (bullish long term). Because negotiators appear close to bipartisan compromises on marketing and are still hashing out yield/DeFi details, the near-term effect is uncertain — traders should monitor draft text and votes: a restrictive yield ban is a potential short-term negative for on-chain liquidity, while clear DeFi inclusion and legal certainty would be positive over time. Overall, immediate impact is neutral until the bill’s specific language is known.