U.S. Senators introduced a long-awaited draft bill on January 13, 2026, to establish a comprehensive regulatory framework for cryptocurrency markets, addressing longstanding uncertainties over whether tokens qualify as securities or commodities.

The legislation, led by Senate Banking Committee Chairman Tim Scott (R-S.C.) alongside Senators Cynthia Lummis (R-Wyo.), Thom Tillis (R-N.C.) and Bill Hagerty (R-Tenn.), seeks to grant the Commodity Futures Trading Commission (CFTC) authority over spot crypto markets—a move favored by the industry over Securities and Exchange Commission (SEC) oversight. Key provisions include prohibitions on crypto firms paying interest solely for holding stablecoins, while permitting rewards for activities like payments or loyalty programs. The SEC and CFTC would issue joint rules on disclosures for stablecoin-related rewards.

This draft builds on bipartisan negotiations and feedback from prior discussion drafts, with a markup originally scheduled for January 15 in the Senate Banking Committee, though it faced delays due to industry concerns. Separately, the Senate Agriculture Committee advanced its companion "Digital Commodity Intermediaries Act" on January 29 in a 12-11 party-line vote, defining digital commodities and imposing consumer protections like conflict-of-interest safeguards on intermediaries.

The Senate efforts follow the House's passage of its Digital Asset Clarity Act, or CLARITY Act, in July 2025, which stalled in the Senate last year over issues like anti-money-laundering rules and decentralized finance provisions. Proponents argue the bills will protect retail investors, foster innovation in the U.S. and prevent criminals from exploiting digital assets, positioning America as the "crypto capital of the world."

Crypto industry leaders hailed the progress. Summer Mersinger, CEO of the Blockchain Association, welcomed the framework but criticized banking pressures to limit stablecoin rewards as anti-competitive. Cody Carbone of The Digital Chamber expressed optimism about refining the text. Banks, however, raised financial stability concerns, particularly over deposit flight risks from stablecoin interest loopholes.

As of today, February 24, lawmakers are pushing to bolster the CFTC's budget by $150 million plus fees from digital asset entities to handle expanded crypto oversight, a provision in the Senate Agriculture bill. Senate Agriculture Chairman John Boozman (R-Ark.) and CFTC Chairman Michael Selig support the increase amid the agency's staffing shortages. The measures now require reconciliation between committees before a full Senate vote, amid the 2026 midterm election cycle.